We looked at 12-month returns for ASX leisure stocks and one trend stood out
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Whether you want to buy into skydiving or spa treatments, ASX investors have more than 20 options when it comes to investing in leisure, travel and recreation.
As wage growth slows and Australians feel increasing pressure on housing and utilities costs, it might seem like spending on holidays and leisure would take a hit.
But recreation spending tends to survive these economic pressures, Bureau of Statistics data shows.
Not all leisure themes are equal, however.
Our table of ASX stocks below shows holiday-makers are the top-performers, while thrill-seekers are struggling and casinos are a gamble.
>> Scroll down for a list of ASX stocks in the recreation, travel or leisure game
Australian families spend around 13 per cent of their weekly household spending on recreational activities — a figure that remains relatively unchanged even as other costs rise.
While housing, food and transport took up more of the household budget in 2015-16 compared to 2009-10, purchases like holidays and hobbies tended to “remain relatively stable”, the ABS says.
“Households in 2015-16 spent less on transport, household furnishings and equipment (such as furniture and appliances), alcoholic beverages and communication (including equipment and usage charges).
“Over this same period the proportion of weekly expenditure spent on food and non-alcoholic beverages, tobacco products, medical care and health expenses, recreation (such as hobbies, holidays and pets), personal care and miscellaneous goods and services remained relatively stable. ”
If you crunch consumer transaction data in large volumes you can also see Australians transition from a “stuff” to an “experience” economy.
NAB’s quarterly consumer spending reports — which categorise more than 2 million customer transactions according to spending type — put accomodation, food, arts and recreation as the fastest growing spend categories.
In the first quarter of 2018, spending on food and accomodation was up 15 per cent, while recreation spending growth came in second at 13 per cent, NAB reports.
Travel booking stocks lead the sector
While tourism and leisure spending is predicted to see modest gains over the next five years, some themes are growing faster than others.
The $11.7 billion sector as a whole will experience 3.4 per cent annual revenue growth between now and 2023, according to researcher IBISWorld.
But growth in online travel and tourism businesses should be double that figure at 7.6 per cent.
“The number of industry establishments [new companies] is expected to rise as new niche travel sites are launched,” IBISWorld reports.
ASX leisure stocks
Our table of one-year stock price returns among leisure stocks reflects IBISWorld’s forecasts.
While half of the leisure-related stocks have made gains over the past year, holiday-makers holiday-making is the strongest theme.
All five of the top leisure stocks are vacation-related: Flight Centre, Helloworld, Webjet, SeaLink and Apollo Tourism.
Flight Centre is far from small cap land with a market cap of $6.9 billion, but it leads the pack with gains of 57 per cent over the past year to land at $67.07 on Monday.
Smaller player Apollo Tourism, which rents and sells RVs, is up 13 per cent to $1.54 this week.
Despite the millennial “experience” theme, stocks in the thrill-seeking category have lost ground. Indoor Skydiving shares are down 63 per cent for the year while Experience Co has lost 10.5 per cent.
Gaming and casino operators have had mixed returns, partly due to the impact of regulatory change. We covered the gaming sector here in May.
Crown Resorts and Cairns-based Reef Casino are up over the past year, while Star Entertainment and Canberra casino operator Aquis Entertainment are down.
Meanwhile heading to the movies or watching TV at home just doesn’t seem to cut it.
Village Roadshow is down 53 per cent over 12 months, Event Hospitality is about even, while TV producer Beyond is down 17 per cent.
Here’s a list of ASX stocks in the recreation, travel or leisure game:
Swipe or scroll to reveal the full table. Click headings to sort