TripAdvisor, Booking Holdings earnings on deck — what two traders are watching

The travel trade took a trip to the green Thursday.

Online trip-booking stocks and hotel shares hit session highs after the State Department’s announcement that it would lift its global health travel advisory on what it said were “improving” health and safety conditions in some countries. The department said it would return “to [its] previous system of country-specific levels of travel advice.”

TripAdvisor and Booking Holdings, both of which are scheduled to report earnings after Thursday’s closing bell, climbed 3% and 2%, respectively. Their results are coming after Hilton, the world’s second-largest hotel operator, reported a loss that was nearly double analysts’ estimates.

Thursday’s moves provide some welcome relief to this group of stocks, which has suffered year to date as Covid-19 halted travel across the globe. Booking Holdings said in an SEC filing earlier this week that it was planning to lay off 25% of its staff.

The State Department’s announcement is “incrementally positive,” for the industry, Steve Chiavarone, a portfolio manager, equity strategist and vice president at Federated Hermes, told CNBC’s “Trading Nation” on Thursday.

“But you still have restrictions on Americans coming in, and I think ultimately, people aren’t just staying home because of mandates,” he said. “They’re staying home because they’re worried about their health.”

Pair that with less-than-ideal travel conditions, few of which can be resolved without big expenditures, and Chiavarone expects the travel trade to be suppressed for a while.

“I think for a lot of reasons, you’re still going to see travel levels down. I think you’re still going to see a preference for domestic travel,” he said. “But, hey, incrementally, the idea that there are parts of the world that have gotten coronavirus under control enough that we can start to lift restrictions, that’s a good thing.”

Matt Maley, chief market strategist at Miller Tabak, said Hilton’s stock could be harboring some opportunities despite the company’s earnings struggles.

“You look at the way the stock has acted and it’s been actually pretty good,” he said in the same “Trading Nation” interview, pointing to the chart.

“It’s bumping up against the top line of what’s called a symmetrical triangle pattern,” Maley said. “If it can get a little bit further above that, that’s going to be bullish.”

Maley’s key level to watch was $88 a share, around Hilton’s 200-day moving average.

“That provided really tough resistance back in June,” Maley said. “If it can break above that, which would also give it a higher high, that’s when you’re really going to see the momentum in the stock.”

“I guess my point is don’t send this stock into the batter’s box right now,” he said. “Put it in the on-deck circle because there’s all the uncertainty out there. Don’t be afraid to miss a little bit of upside. But if it can break above its 200-day moving average, it’s really going to fly with a lot of momentum. So, be ready to use it if and when it comes.”

Don’t miss Seema Mody’s exclusive interview with Booking Holdings CEO Glenn Fogel this Friday at 1 p.m. ET on CNBC’s “The Exchange.”


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