U.S. Global Investors (NASDAQ:GROW) CEO Frank Holmes talked with Proactive about the strong resurgence in the travel sector and what it means for airline stocks, particularly those held within the company’s JETS and US Global Investors Travel UCITS ETF (LSE:TRIP) ETFs
Holmes noted that higher-income Americans are driving international travel demand, especially to Europe, leading to strong pricing power among airlines. “Americans are traveling to Europe in unprecedented numbers, so there is a real economic boom and the airlines have pricing power,” he said.
He highlighted how this demand has translated into performance, with United Airlines — the top holding in the TRIP ETF — experiencing a 130% increase, defying all analyst expectations for 2024. Holmes also pointed to rising pricing across cruise lines and hotels, noting a 15% compounded growth rate in ticket prices over five years.
Holmes mentioned the integration of AI by airlines like British Airways to improve operations, which he sees as a key factor in margin expansion. He remains bullish on the sector, citing strong summer travel data and undervaluation compared to broader markets. “I think we remain very positive going into year end,” Holmes added.
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