In this article, we shall discuss the 15 most underrated states in the US. To skip our detailed analysis of the tourism industry in the United States in 2024, go directly and see 5 Most Underrated States in the US. 

US Domestic Travel Market Outlook 2024: An Analysis

Even during periods of rampant financial instability, American tourists have been willing to spend extensively on travel, even to the most underrated states in the US. According to a report by Deloitte, there is a rising enthusiasm for in-destination activities to the least-visited states and a growing interest in more diverse destinations, with more than 40 million Americans flying out of the U.S. in 2023, finally lagging pre-pandemic levels. 2023’s 40 million outbound travelers marks an 8.6% increase over 2019, the last year before the COVID-19 pandemic engulfed and stagnated the global economy, shuttering international travel. TSA-reported passenger throughput was up by an average of 12.5% year-over-year in 2023. US outbound travel was mostly concentrated in Europe and Asia, with the UK, France, Germany, Malaysia, and Indonesia receiving nearly 29.1% of the American travel market. To read more on where American travelers have been preferring to fly, check out our coverage of the 25 Best Countries for Americans to Visit. Furthermore, in 2024, the report projects that full-year revenue per available room will likely rise 4.8% year-over-year.

There are mounting concerns that leisure travel has tapped its pent-up demand in the wake of the pandemic and amid economic turbulence, inflationary concerns, and rising interest rates, travel in the US might soon be subject to tighter budgets for consumers and corporate buyers especially in many of the least-visited states in the US. However, the Deloitte report puts these concerns to rest. According to the report, although outbound travel may see a dip, consumer intent to engage with in-destination activities, especially to some of the most underrated states in the US, has ramped up. Travelers planning to visit a domestic attraction on their holiday trips jumped up from 36% in 2023 to 43% in 2024. Even if the macroeconomic outlook worsens, the report projects that the American traveler is likely to reprioritize travel rather than forsake it completely, with more Americans deciding to ride out the storm closer to home by curtailing the distance and length of their trips.

It is because of this reason that investor sentiment around major travel ETFs has skyrocketed in recent years. Take for instance Amplify Travel Tech ETF (NYSE:AWAY) which provides investors with active access to technology equities in the American travel and tourism space like Booking Holdings Inc. (NASDAQ:BKNG), Airbnb Inc. (NASDAQ:ABNB), and Expedia Group Inc. (NASDAQ:EXPE). The fund seeks investment results which tend to correlate to the total return performance of the Prime Travel Technology Index NTR. The ETF has an expense ratio of 0.75% and net assets worth around $75 million. Another ETF which focuses on US travel stocks like Booking Holdings Inc. (NASDAQ:BKNG), Expedia Group Inc. (NASDAQ:EXPE) and Marriot International Inc. (NYSE:MAR) is Invesco Leisure and Entertainment ETF (NYSE:PEJ). The fund is based on the Dynamic Leisure & Entertainment Intellidex Index. The ETF is up 4.4% year-to-date. To read more on travel stocks investors are flocking to, check out our article on the 12 Best Travel Stocks To Buy Right Now.

So although investor sentiment around domestic leisure travel to the most underrated states in the US is picking up, a closer look at business travel tells a more nuanced story. According to a report by the Financial Times, the rise in video conferencing, heightened environmental concerns, and employers adamant on cutting costs has led to serious headwinds for domestic business travel in the United States. Business travel in the United States is expected to remain below pre-pandemic levels till 2026, while business travel spending is not projected to recover until 2028. Although business travel is slated to grow year-over-year through to 2027 even in many of the most underrated states in the US, the rate of growth is expected to decline. In 2024, global business travel spending is expected to reach $265.5 billion, nearly 87% of pre-pandemic levels. Domestic business travel volume is expected to hit the $442 million mark by the end of 2024, about 95% of 2019 levels. However it is pertinent to note that despite major European and American employers have cracked down on non-essential trips, business travel in the US is far from dead. Global bookings reached 70% of 2019 levels in October 2023, up 63% from April of the same year. According to Marriot International Inc. (NYSE:MAR), the average length of the business trip has increased by more than 20% compared to 2019, even in many of the least-visited states.

Travel in the Age of AI: An Overview

According to McKinsey, major players in the American travel industry like Booking Holdings Inc. (NASDAQ:BKNG), Airbnb Inc. (NASDAQ:ABNB), and Expedia Group Inc. (NASDAQ:EXPE) are navigating the headwinds associated with domestic travel in the US by ushering in a new era of digitally enabled travel. Advancements in artificial intelligence and machine learning is changing the way companies interact with customers, develop products and services, and manage operations in the most underrated states in the US. Since 2013, the average time spent on digital devices has grown by nearly 70% in the US with the pandemic only exacerbating this trend. As online experiences replace in-person contact, the industry is forced to redefine traditional travel, a fundamentally human-centric experience, to what it would look like in the digital age.

Recent advancements in technology provide an impetus for companies like Booking Holdings Inc. (NASDAQ:BKNG), Airbnb Inc. (NASDAQ:ABNB), and Expedia Group Inc. (NASDAQ:EXPE) to reimagine their product design and delivery using AI and digitization capabilities. AI offers the travel space new ways to augment and scale capabilities like language, creativity and aesthetic judgment, potentially unlocking more than $4 trillion in annual value across industries in the most underrated states in the US. For instance, gen AI could inform a digital assistant to aid companies like Airbnb Inc, (NASDAQ:ABNB) and Marriot International Inc. (NYSE:MAR) to curate personalized itineraries during discovery and booking. It allows companies to tailor recommendations and seamlessly resolve unexpected disruptions.

With international travel to the US expected to grow at an average of 5.8% annually through to 2032 at more than double the expected growth rate of the overall economy, the US travel industry is ripe for innovation.  A study by Lufthansa Innovation Hub tracked the investment strategies of more than 60 companies and revealed that AI and machine learning represented more than 65% of all investment across hospitality, ground transportation, aviation, and online travel segments. The study reveals that investment focus on AI has increased more than 60% every year since 2018, even in some of the least-visited states. Although gen AI has not been able to garner as much excitement yet, the trajectory is on the upswing, with notable investments being made in small companies like UrbanFox, NLX and SparkCognition.

Our Methodology

To compile our list of the 15 most underrated states in the US, we first gathered data on tourist arrivals in each state in 2023 and shortlisted 25 states with the lowest tourist arrivals. Next, we decided to measure the tourist offerings in each of these 25 states. Since measuring a state’s tourist offerings is an incredibly multifaceted and complex phenomenon, we established a three-pronged criteria, with a point-based weighted approach; the criteria are premised on each state’s natural beauty (15 points), tourism infrastructure (10 points), and online reviews and ratings (5 points). We then proceeded to award each state a cumulative score according to the aforementioned criteria and selected 15 states which scored the highest points. Subsequently, we ranked each entry based on the total points scored, from lowest to highest. Where there was a tie, we broke it based on the natural beauty and tourism infrastructure of the state.

By the way, Insider Monkey is an investing website that tracks the movements of corporate insiders and hedge funds. By using a similar consensus approach we identify the best stock picks of more than 900 hedge funds investing in US stocks. The top 10 consensus stock picks of hedge funds outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here). Whether you are a beginner investor or a professional looking for the best stocks to buy you can benefit from the wisdom of hedge funds and corporate insiders.

You can also read our coverage of the 20 Most Overrated Cities in the US According to Reddit.

15 Most Underrated States in the US

15. Idaho

Insider Monkey’s Score: 12

Although primarily known for its agriculture, there is much more to the state of Idaho. The state boasts rugged, beautiful mountains, wild whitewater, and pristine lakes. One can visit Craters of the Moon National Monument, the Shoshone Falls Park and the Silverwood Theme Park for a fraction of the price such activities would demand in states like New York and California. Despite its potential for tourism, the state’s annual visitor count of 37 million in 2023 makes it one of the least-visited states in the US.

14. Indiana

Insider Monkey’s Score: 13

With Bloomington’s famous music scene, Indianapolis’s booming craft beer industry, and Northern Indiana’s beautiful lakes, the state of Indiana is one of the most underrated states in the US for yearlong travel.  With 66.7 million inbound visitors, the Hoosier State is laden with world-class restaurants, bars, shopping centers, and hotels. The state is also known for its burgeoning art culture.

13. Missouri

Insider Monkey’s Score: 15

Common perception tends to dictate Missouri as being a boring, agricultural state. However, cities like Kansas City, Springfield, and St. Louis have a burgeoning nightlife. The Gateway Arch National Park is an excellent waterfront facility to enjoy time with family and friends. The state is also laden with many jazz and blues clubs and more than 50 state parks. Food is also impeccable, with the state being known for its slow cooked barbeque.

12. Alabama

Insider Monkey’s Score: 15

With a meagre 28.7 million visitors in 2023, there is more to the state of Alabama than meets the eye, with the state offering attractions like the Flora-Bama bar near Orange beach and the annual mullet toss festival. The state also houses multiple historical sites from the Civil Rights movement for history buffs like the Civil Rights Institute and the National Voting Rights Museum in Selma, making it one of the most most underrated states in the US. 

11. Vermont

Insider Monkey’s Score: 16

One of the most artistic states in the US, Vermont’s annual tourist arrival of 13 million in 2023, which makes it one of the least-visited states in the US, does not accurately reflect all that the state has to offer. The state is laden with natural beauty, most evidently put forth by Lake Champlain and the Burlington Bike Path. Its also ideal for a quiet romantic getaway with one’s partner, with serene locations like the Church Street Marketplace and numerous wineries.

10. West Virginia

Insider Monkey’s Score: 18

Widely known as the ‘Mountaineer State’, West Virginia is one of the least-visited states in the US. However, it is filled with natural beauty attractions like the North Fork Mountain Trail, which offers tourists the opportunity to bike through the mountains while overlooking breathtaking views of the Seneca Rocks. The state is also a must-visit for water sports enthusiasts owing to the Gauley River which boasts a 14-foot waterfall for rafting.

9. Delaware

Insider Monkey’s Score: 18

Being one of the only tax-free shopping locations in the United States, the state of Delaware is one of the most underrated states in the US for shopping enthusiasts. Furthermore, one can also visit one of the many pristine beaches and state parks Delaware has to offer. The state is also a must-visit for history buffs owing to locations like the Old New Castle.

8. South Dakota

Insider Monkey’s Score: 20

One of the most beautiful states in the US, South Dakota is laden with breathtaking locations like the Badlands National Park, the Mount Rushmore National Memorial, and the Custer State Park. The state also has multiple ghost towns, a dinosaur sculpture park and the famous Wall Drug. The fact that it received less than 13.5 million visitors in 2023 makes it one of the most underrated states in the US.

7. South Carolina

Insider Monkey’s Score: 21

Online reviews and Reddit threads rave about all that South Carolina has to offer. With attractions like the Fort Sumter National Monument and Broadway at the Beach, the state is a must-visit for families and friends alike. The state is home to pristine beaches and enormous golf courses as well, making it a must-visit for golf and surfing enthusiasts.

6. Nebraska

Insider Monkey’s Score: 22

With attractions like Chimney Rock and the Scotts Bluff National Monument, Nebraska is one of the most underrated states in the US. The state is also home to the Omaha’s Henry Doorly Zoo and Aquarium and the Durham Museum, making it the ideal destination to visit with friends and family.

5. Oklahoma

Insider Monkey’s Score: 22

The city of Tulsa is one of the best weekend destinations in the US and yet, somehow is the least talked about. The city has its very own philharmonic, ballet, and two of the country’s best art museums in Philbrook and Gilcrease. The ‘Sooner State’ also houses the Oklahoma City National Memorial & Museum, the National Cowboy & Western Heritage Museum, and opportunities to hike and bike on its rugged mountains.

4. Iowa

Insider Monkey’s Score: 25

Known as the ‘Hawkeye State’, Iowa is known for the Sundown Mountain near Dubuque, which is an alternative to the expensive ski states in the North. The outskirts of Iowa City also offer the Coralville Lake and the Devonian Fossil Gorge. The state is a must-visit for biking enthusiasts as it also hosts the RAGBRAI (Register’s Annual Great Bike Race Across Iowa) from the Missouri River to Mississippi. Despite this, it is one of the least-visited states in the US.

3. North Dakota

Insider Monkey’s Score: 26

With a mere 21 million visitors in 2023, North Dakota has more than 63 national wildlife sanctuaries and 13 state parks, making it one of the most underrated states in the US. The city of Fargo is known for its nighttime walks, exotic food, and vibrant brewing community. The state is also in the midst of a music boom.

2. Alaska

Insider Monkey’s Score: 28

Alaska receives less than 2.4 million tourists annually, which makes it one of the least-visited states in the US. However, the state is laden with exotic wilderness and wildlife, with tourists able to explore the plains via rail, road, and snowmobiles. The city of Juneau has an amazing food scene and one may also take a glance at polar bears at the Alaska Zoo in Anchorage. In the winters, one may also get to catch a front row seat to the northern lights, making Alaska number 4 on our list of the most underrated cities in the US.

1. New Hampshire

Insider Monkey’s Score: 29

New Hampshire has it all; from historic river valleys to some of the highest mountains in the country, the state is known for its New England village aesthetic and outdoor moose safaris. The White Mountains offer the best hike trails in the country and in the winter season, tourists can undertake sledging and skiing at extremely affordable prices. With 54 covered bridges, the state is remarkably easy to travel, and thus tops our list of the most underrated states in the US. 

While we acknowledge the potential of travel companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. 15 Most Underrated States in the US was originally published on Insider Monkey.