This morning the Australian Bureau of Statistics released its inbound and outbound tourism data for the month of May.
According to the release, Australia welcomed a seasonally adjusted 766,300 short term visitors onto its shores during the month. This was a 1.4% increase on the prior month, with the year-on-year trend revealing growth of 3.7%.
The biggest driver of this growth was tourism from China and India. Inbound visitors from these two nations rose 6.9% and 20.9% respectively on the prior corresponding period. This offset a surprise decline in U.S. tourism, which has fallen 4.5% year-on-year.
Can this continue?
I believe this trend can continue for some time to come, especially if the Australian dollar weakens and makes it an even more attractive destination for tourists.
This means Australian companies with exposure to the tourism sector could benefit greatly over the coming years.
As a result, I think these three shares could be worth a look today:
Experience Co Ltd (ASX: EXP)
Experience Co is an adventure tourism company which I think has enormous promise. Although FY 2018 will be a year to forget after a once-in-a-generation weather event impacted many of its businesses, I believe it will bounce back with a bang in FY 2019 and continue its remarkable growth. Especially with the tourism boom likely to result in increased demand for its offering.
Sydney Airport Holdings Pty Ltd (ASX: SYD)
Sydney Airport Holdings is the operator of Australia'a busiest airport. This makes it an obvious choice for investors wanting to gain exposure to the rising number of inbound and outbound tourists. One concern, though, is that traditionally the company's shares have been treated like a bond proxy. This could mean they come under pressure when bond yields widen.
Webjet Limited (ASX: WEB)
This online travel agent is my top pick in the travel sector. I think it has a number of strong brands that are capable of continuing to grow bookings ahead of the industry average in the coming years. Thanks to this and the shift to online booking, I feel confident Webjet can grow earnings at a solid rate for some time to come.
