With the emergence of the COVID-19 global pandemic, certain industries are hit harder than others. The hospitality business is all but defeated, suffering major losses and huge dips in stock value over the past several months.
Only recently has the industry seen slight week-by-week growth, but it is still in a bad place compared to where it was at this time last year. There’s no arguing that hotels, cruises, airlines, and all others in the hospitality business are majorly suffering as the pandemic takes a serious hit to the U.S. economy.
How will hotels survive? What factors are contributing to their slight growth over these rocky weeks as we struggle to slowly return to normalcy? A stock market analysis can help provide insight into these interesting new stock trends.
An in-depth study posted by Calculated Risk Blog shows that the hotel industry is very slowly rising, but is still in a huge decline when compared with the performance numbers from May 2019.
For example, occupancy rates have dropped as low as -69.8% in comparison with April and May of 2019, with an average daily rate of $74. This is almost 150% less than the previous yearly reports.
But when there’s a will, there’s a way. Despite these crushingly low numbers, there is actually an increased demand for hotels and a slow rise in occupancy that just may save the hotel industry by a hair.
Thankfully, there is a slow but steady rise in demand for hotel occupancy. While the devastation of the Coronavirus is still too drastic to compare true numbers between last year and this year, the fact that there is still some demand gives us hope.
This is true for the entire hospitality industry; airlines have seen slightly increased occupancy with air travelers over the past couple of weeks, lending itself well to the rising need for available hotel rooms across the entire USA.
The hotel industry is reporting a week-by-week increase in demand, which has been in steady ascension for the past month. Also, make sure you check out sam Shiah mastermind where he goes into more detail about people’s flying patterns, the hotel industry and how that directly affects wall street. Since more people are flying, more people are staying in hotels, whether it be for business or personal reasons.
In fact, the number of rooms sold per week finally reached 10 million for the first time since before the pandemic and before the stay-at-home orders were issued. It’s a good indicator of better things to come, but it in no way a sign of the industry making a full recovery.
10 million rooms may seem like a lot – but it is a fraction of the numbers the industry brought in last year. However, we continue to see small upward changes that will hopefully pave the way for a strong final quarter in 2020.
What We Can Do?
While many states across the country are still enforcing lockdown orders, and others are more lenient with their pandemic rules, it is still difficult to safely travel and resume life as it once was. However, there are certain situations that may allow for the booking of flights and hotels. If you are a business traveler, or you are trying to connect with a relative in need, the airlines and hotels are open and available to you.