In this article, we will take a look at the 12 best airport stocks to buy.
Despite the rising inflation and recession fears, the travel and tourism industry is showing surprising signs of resilience as consumers all over the world continue to travel and spend. In December, Bloomberg said in a report that international tourists boosted their spending at top travel destinations in 2022. The report cited data from the Top 100 City Destinations Index 2022 report which was released by Euromonitor International.
The report said that inbound tourism spending in 2022 increased by a whopping 112% compared to 2021. Tourist spend per trip was up 13%. For 2023, numbers show an ever more bullish picture. Total tourist spend in the year is expected to exceed $1.4 trillion. The report added the international travel in 2023 is expected to grow by 40%. However, this shows a decline in growth compared to the 80% figure set for 2022. The report said that rising inflation is the culprit behind this trend. However, the outlook for the travel and tourism industry is upbeat.
According to a whitepaper released by the Economist Intelligence Unit, international tourism will grow by 30% in 2023. However, the whitepaper said that the growth will not reach the pre-pandemic levels due to the Russia-Ukraine war and an uncertain global economic situation.
According to a report by the World Travel & Tourism Council, while the recovery in 2021 was slower than expected due to COVID-19 variants, the outlook for the travel industry is solid. According to the report, the industry’s contribution to the US GDP increased 21% to reach $5.8 trillion in 2021, while the industry’s total share in the company jumped from 5.3% in 2020 to 6.1% in 2021. In 2021, the travel and tourism industry saw a massive recovery of 18.2 million jobs, representing an increase of 6.7%.
The World Travel & Tourism Council was more bullish on the industry for 2022. It expected the industry’s contribution to the country’s GDP to rise by 5.8% annually between 2022 and 2032, outpacing the growth of the overall economy (2.7% per year).
One of the biggest growth catalysts for the tourism industry, according to analysts, is the reopening of China. Chinese tourists account for a major chunk of revenue of the global tourism industry. A WSJ report recently said that Chinese tourists accounted for a third of total arrivals in Japan and South Korea before the pandemic, while they made up a quarter of total visitors to Thailand in 2019. Airport companies and duty free shops are also poised to gain from China’s reopening. The WSJ report said that the shares of South Korea-based Hotel Shilla, which operates duty free shops and hotels, have gained over 28% in the past two months. Chinese visitors are fond of duty free shops and the reopening of tourism industry and the influx of Chinese visitors at global airports will bode well for airport companies.
Some notable airport stocks in our list include Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB) and Dufry AG (OTC:DUFRY).
Image by Rudy and Peter Skitterians from Pixabay
Our Methodology
For this article we focused on two kinds of companies. First, we selected the companies that are operating major airports in the world. In this category you will find several international (non-US) stocks which provide investors a chance to bet on high-growth emerging markets. Second, we listed some of the best airport stocks that are linked to the travel and tourism industry. In this category, you will see companies that are operating duty free or retail stores at some of the notable airports in the world.
Best Airport Stocks To Buy
12. Aena S.M.E., S.A. (OTC:ANYYY)
Aena S.M.E., S.A. (OTC:ANYYY) is one of the biggest airport operators in the world, having handled over 293 million passengers in 2019. The Madrid-based Aena S.M.E., S.A. (OTC:ANYYY) operates 46 airports in Spain. Aena S.M.E., S.A. (OTC:ANYYY) recently said that in December 2022, it saw a 98.1% recovery compared to the same month in 2019. The company processed 243,681,775 passengers in 2022, which shows an 88.5% recovery in passenger traffic compared to 2019.
Aena S.M.E., S.A. (OTC:ANYYY) is one of the best airport stocks for those who want to bet on the global tourism industry. Aena S.M.E., S.A. (OTC:ANYYY) operates airports in Spain and several other countries and is set to profit from the growth in the travel industry in the coming years.
In August last year, the company secured a concession contract to manage 11 airports in Brazil for a period of 30 years.
11. Dufry AG (OTC:DUFRY)
Dufry AG (OTC:DUFRY) deserves addition in our list of the best airport stocks to buy since Dufry AG (OTC:DUFRY) is operating thousands of duty free and retail stores at hundreds of airports all over the world. The Swiss company continues to see growth despite a macroeconomic slowdown. This is because the travel industry continues to be resilient as more and more people are travelling all over the world.
During the first nine months of 2022, Dufry AG (OTC:DUFRY) posted a whopping 100% in organic growth with an EBITDA that reached CHF 463.7 million with a margin of 9.2%. The company’s debt came in at CHF 2.7 billion, which shows the lowest debt levels since March 2015.
In the summer of 2022, Dufry AG (OTC:DUFRY) announced that it planned to merge with food and beverage company Autogrill. Dufry AG (OTC:DUFRY) said that the combined entity will process a whopping 2.3 billion passengers in more than 75 countries.
10. Aéroports de Paris (Groupe ADP)
Aéroports de Paris (Groupe ADP) is a French airport operator which manages famous French airports including Charles de Gaulle Airport, Orly Airport and Le Bourget Airport. Like other companies operating in the sector, Aéroports de Paris (Groupe ADP) is also seeing a major influx of tourists at its airports. Aéroports de Paris (Groupe ADP) said that its total traffic in number was up by 5.5 million passengers in November 2022 when compared to last year. It welcomed a total of 22.9 million passengers at all the airports it manages.
9. Lagardère Group (Private)
Lagardere Group is a French company with a variety of businesses. What makes Lagardere Group one of the best airport stocks is the company’s retail segment, which runs retail stores are some of the major airports in the world. Lagardère Group is operating more than 4800 duty free, retail and travel essentials stores across several airports and railway stations in 42 countries worldwide.
8. Fraport AG (OTC:FPRUY)
Fraport AG (OTC:FPRUY) is a German company that operates Frankfurt Airport in Frankfurt and several other airports. Fraport AG (OTC:FPRUY) also manages ground handling operations at its own operated airports and at third-party operated airports. Fraport AG (OTC:FPRUY) has operations at about 31 airports all over the world. Fraport AG (OTC:FPRUY)’s website says that more than 182 million passengers in 2019 used airports around the world in which Fraport AG (OTC:FPRUY) has at least a 50% stake.
7. TAV Airports Holding (Private)
If you want to bet on the ever-growing Turkish tourism industry, TAV Airports Holding could be a decent choice for you. Trading on the Istanbul Stock Exchange, this company is a part of Groupe ADP. Recently, TAV Airports Holding said that in 2023 it will focus on high-growth areas like Africa and Central Asia.
6. Airports of Thailand Public Company Limited (OTC:AIPUY)
Airports of Thailand Public Company Limited (OTC:AIPUY) is trading on the Bangkok Stock Exchange and gives investors a chance to bet on the ever-growing Thai travel industry. Airports of Thailand Public Company Limited (OTC:AIPUY) is operating at least six international airports in Thailand. The stock ranks sixth in our list of the best airport stocks to buy.
Airports of Thailand Public Company Limited (OTC:AIPUY) is in a strong position to benefit from the growing number of travelers arriving in Thailand. Last month, reports suggested that a whopping 2 million international and domestic travelers were expected to arrive at major Thailand airports due to the Holiday season.
In the next of this article we will talk about some other airport stocks, including Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) and Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB).
5. Blade Air Mobility, Inc. (NASDAQ:BLDE)
Not a pure play airport operator stock, Blade Air Mobility, Inc. (NASDAQ:BLDE) is still directly related to the travel industry as its plays a key role in the tourism ecosystem. Blade Air Mobility, Inc. (NASDAQ:BLDE)’s technology allows passengers to book seats on scheduled flights throughout the Northeast and West Coast of the United States. Blade Air Mobility, Inc. (NASDAQ:BLDE) also offers private jets and helicopters. In the third quarter, Blade Air Mobility, Inc. (NASDAQ:BLDE)’s revenue jumped about 124% to reach $45.7 million, beating analyst estimates by $7.01 million. Blade Air Mobility, Inc. (NASDAQ:BLDE) is also expanding in other key areas of the travel industry. It has acquired three helicopter activities in Europe to create the largest UAM service on the continent.
As of the end of the third quarter of 2022, 10 hedge funds tracked by Insider Monkey reported having stakes in Blade Air Mobility, Inc. (NASDAQ:BLDE), compared to 7 funds in the previous quarter. The total value of these stakes was about $66 million.
4. Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB)
Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB) is a Mexican airport operator that manages about 13 airports in the central and northern states of Mexico, including that of Monterrey, one of Mexico’s largest cities. Last year Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB) started reaping the rewards of a massive recovery in the travel industry, as its Q3 report showed that the company’s adj EBITDA margins improved 1.3% pts YoY to 76.5% on a continued traffic recovery. Analysts expect the company to continue on this wave of recovery for the months to come.
As of the end of the third quarter, 6 hedge funds tracked by Insider Monkey reported having stakes in Grupo Aeroportuario del Centro Nort (NASDAQ:OMAB). The total value of these stakes was about $25 million.
3. Grupo Aeroportuario dl Srst SAB CV (NYSE:ASR)
Another Mexican airport operator on our list, Grupo Aeroportuario dl Srst SAB CV (NYSE:ASR) is operating 9 airports in the southeastern states of Mexico, including that of Cancún. Grupo Aeroportuario dl Srst SAB CV (NYSE:ASR) is the third biggest airport services company by passenger traffic in Mexico. Grupo Aeroportuario dl Srst SAB CV (NYSE:ASR) is currently in the spotlight after it said its passenger traffic in December grew by a whopping 22.9% when compared to December 2019 to reach 6.4 million. Domestic traffic in the month rose 21.3% when compared to December 2019. This shows that travel trends are now better than they were before the coronavirus pandemic.
As of the end of the third quarter, 6 hedge funds tracked by Insider Monkey reported having stakes in Grupo Aeroportuario dl Srst SAB CV (NYSE:ASR), compared to 6 funds in the previous quarter.
2. Grupo Aeroportuario del Pacifico (NYSE:PAC)
Yet another Mexican airport operator in our list, Grupo Aeroportuario del Pacifico (NYSE:PAC) operates 12 airports in the western states of Mexico, and 2 in Jamaica. Grupo Aeroportuario del Pacifico (NYSE:PAC) is behind two of the most popular airports in the country related to famous travel destinations Los Cabos and Puerto Vallarta. Grupo Aeroportuario del Pacifico (NYSE:PAC) is the second largest airport services company by passenger traffic in Mexico. Grupo Aeroportuario del Pacifico (NYSE:PAC) serves about 27 million passengers annually. This Mexican airport operator, like its peers, is posting strong numbers which show that travel demand is now surpassing the pre-pandemic metrics. Earlier this month, Grupo Aeroportuario del Pacifico (NYSE:PAC) said that its passenger traffic in December was 18.6% more than it was in December 2019. Domestic traffic in the month also jumped 26.1% when compared to December 2019.
A total of 4 hedge funds tracked by Insider Monkey reported having stakes in Grupo Aeroportuario del Pacifico (NYSE:PAC) as of the end of the third quarter.
1. Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW)
Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) is a notable airport stock since the company operates flights on ACMI (Aircraft, Crew, Maintenance and Insurance), CMI and air charter basis for airlines, express operators, freight forwarders, charter brokers and shippers. Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) owns Atlas Air, Polar Air Cargo, and Titan Aircraft Investments.
Hedge fund sentiment is strong for the stock. As of the end of the third quarter, 37 hedge funds tracked by Insider Monkey reported having stakes in Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW), compared to 28 hedge funds in the previous quarter. The total value of these stakes was $831 million.
However, the third quarter report of Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) disappointed investors, as the company posted non-GAAP EPS of $2.69, missing the estimates by $1.57. Revenue in the quarter jumped 9.8% to total $1.12 billion but missed estimates by $70 million.
FPA made the following comment about Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) in its Q3 2022 investor letter:
“Atlas Air Worldwide Holdings, Inc. (NASDAQ:AAWW) is an outsourced air freight carrier that we believe traded on cheap multiples of earnings and book value compared to peers. In August, the company agreed to be bought by a consortium led by Apollo Capital for $102.50 per share, a 57% premium to the recent share price.”
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Disclosure: None. 12 Best Airport Stocks To Buy is originally published on Insider Monkey.
