It looks like smoother sailing for cruise stocks.
After being capsized by the pandemic, many are showing big signs of life again. Carnival (CCL), for example, is up 13% on the day on heavy volume after Bank of America said demand is trending higher, and in some cases, surpassing pre-pandemic levels.
Bank of America upgraded Carnival to Buy from Neutral and raised its price target from $11 to $20. It also raised price targets for both Royal Caribbean and Norwegian Cruise lines while keeping a Neutral rating on both companies.
Aside from Carnival, another way to trade a potential rally in vacation demand is with an ETF, such as the Defiance Hotel Airline and Cruise ETF (CRUZ).
Travel-starved Americans are now looking to book revenge travel plans. All in an effort to compensate for what they missed out on during the pandemic. All of which could be great news for the CRUZ ETF.
With an expense ratio of 0.45%, the ETF tracks the performance of global hotels, airlines, and cruises. Some of its top holdings include Marriott, Royal Caribbean, Hilton Worldwide, Carnival, Delta Air Lines, Southwest Airlines, and many more. What’s nice about an ETF such as the CRUZ ETF is that we can buy 100 shares for about $2,000. Meanwhile, if we bought 100 shares of just Royal Caribbean, it would cost about $9,122.
