In light of United Airlines Holdings Inc. (UAL, Financial) and American Airlines Group Inc. (AAL, Financial) forecasting increased travel demand over the next few months, five travel stocks with high guru and insider buys are MGM Resorts International (MGM, Financial), DraftKings Inc. (DKNG, Financial), TripAdvisor Inc. (TRIP, Financial), Linblad Expeditions Holdings Inc. (LIND, Financial) and Scientific Games Corp. (SGMS, Financial) according to the Guru and Insider Double Buys screen, a Premium feature of GuruFocus.
Major airlines forecast surging travel demand as summer season approaches
Chicago-based United said it expects second-quarter total revenue per available seat mile of approximately 17% higher than that of 2019, representing the strongest second-quarter guidance in the airline’s history.
American CEO Robert Isom said that the Fort Worth, Texas-based airline “expects to be profitable” during the second quarter as demand for domestic travel improves as offices reopen and governments lift travel restrictions. The company expects second-quarter revenue to be between 6% and 8% higher than revenue for the second quarter of 2019.
As investors monitor the surge in travel demand, GuruFocus’ Double Buys screen listed several travel stocks that have high guru and insider buys over the past three months. Legendary Fidelity Magellan Fund manager Peter Lynch said that while insiders may sell shares for several reasons, they buy only when they believe the stock is set to appreciate in value.
MGM Resorts
Four gurus and two insiders purchased shares of MGM Resorts International (MGM, Financial) over the past three months. The total number of shares purchased by insiders was 4,505,628.
Shares of MGM Resorts traded around $42.81, showing the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 1.48.
The Las Vegas-based casino operator has a GF Score of 66 out of 100: Although the stock has a profitability rank 6 out of 10 and a momentum rank 8 out of 10, MGM Resorts has a rank of just 3 out of 10 for financial strength, growth and GF Value.
Gurus with holdings in MGM Resorts include Mason Hawkins (Trades, Portfolio)’ Southeastern Asset Management and Ron Baron (Trades, Portfolio)’s Baron Funds.
DraftKings
Two gurus and two insiders purchased shares of DraftKings (DKNG, Financial) over the past three months. The total number of shares purchased by insiders was 205,000. Shares traded around $14.41 on Thursday.
Although the Boston-based digital sports gaming company has a GF Score of 18 out of 100, the stock does not have a growth rank, GF Value rank or momentum rank due to insufficient data. Thus, the GF Score may not give an accurate picture of the stock’s performance potential based on GuruFocus’ backtesting research from 2006 to 2021.
Gurus with holdings in DraftKings include Catherine Wood (Trades, Portfolio)’s ARK Investment and Baron Funds.
TripAdvisor
Three gurus and one insider purchased shares of TripAdvisor (TRIP, Financial) over the past three months. The total number of shares purchased by insiders was 50,000.
Shares of TripAdvisor traded around $26.39, showing the stock is modestly undervalued based on Thursday’s price-to-GF Value ratio of 0.87.
The Needham, Massachusetts-based online travel review company has a GF Score of 66 out of 100: While the company has a GF Value rank of 9 out of 10 and a profitability rank of 6 out of 10, TripAdvisor has a rank of just 1 out of 10 for growth and 4 out of 10 for financial strength and momentum.
Linblad Expeditions Holdings
Two gurus and one insider purchased shares of Linblad Expeditions Holdings (LIND, Financial) over the past three months. The total number of shares purchased by insiders was 36,200.
Shares of Linblad traded around $16.07, showing the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 1.52.
The New York-based expedition cruise and adventure travel service company has a GF Score of 60 out of 100: While the company has a momentum rank of 7 out of 10 and a profitability rank of 5 out of 10, Linblad has a rank below 3 out of 10 for financial strength, growth and GF Value.
Scientific Games
Two gurus and one insider purchased shares of Scientific Games (SGMS, Financial) during the past three months. The total number of shares purchased by insiders was 31,250.
Shares of Scientific Games traded around $59.73, showing the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 2.43.
The Las Vegas-based gaming products company has a GF Score of 53 out of 100: Although the company has a momentum rank of 10 out of 10, Scientific Games has a rank below 4 out of 10 for financial strength, profitability, growth and GF Value.
