If you've been to an airport over the past six months, you would hardly think that Australia and the world are at the brink of economic calamity.
There are travellers climbing over each other to pay a fortune for plane tickets, desperate to fly off for a trip.
Who would even know mortgage holders have copped 11 interest rate rises in the space of just one year?
The team at Elvest Fund this week revealed that it's taking full advantage of this theme through its holdings in two ASX travel shares:
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'Rapid recovery in leisure travel'
Helloworld Travel Ltd (ASX: HLO) shares have, believe it or not, already rocketed 124% so far this year.
But Elvest analysts reckon there's plenty more where that came from, as the travel agent seems to have underplayed its prospects for the current quarter.
"The new guidance range of $38 to $42 million implies EBITDA slows during the seasonally strong June quarter — an unlikely scenario given the upward trajectory of travel activity," they said in a memo to clients.
The last quarter was admittedly extremely strong.
"Third quarter FY23 EBITDA came in at $14.2 million, up from a $4.9 million loss in the prior corresponding period," read the memo.
"Helloworld upgraded FY23 EBITDA guidance by a further 33% (at the midpoint), driven by the continued rapid recovery in leisure travel during the March quarter."
The wider professional community concurs with the Elvest analysts. Five out of six analysts currently surveyed on CMC Markets rate Helloworld shares as a buy.
Huge contract win
Corporate Travel Management Ltd (ASX: CTD) shares haven't quite doubled like Helloworld, but have still served investors pretty well with a 39.3% hike year to date.
The big catalyst came last month.
"Corporate Travel announced a large two-year travel management contract with the UK Home Office," read the Elvest memo.
"Estimated at $3 billion of total transaction value, the contract is for the management of accommodation and travel for asylum seekers."
In fact, the share price soared more than 10% on the morning of the announcement.
The team has the same confidence in Corporate Travel as it does with Helloworld, although the former's business-orientated clientele might mean the performance boost is delayed.
"The broader outlook for Corporate Travel is improving," read the memo.
"Though we expect Corporate Travel's post-COVID recovery will lag by six to 12 months as airline capacity normalises."
Elvest's peers are more divided on Corporate Travel than Helloworld, with nine analysts on CMC Markets rating it as a buy versus seven saying hold. One holdout is urging a strong sell.
