In early June, Morgan Stanley (NYSE:MS) published a report on travel industry trends. The results confirm what many investors believe when it comes to the best travel stocks. That is, follow the money.  

This earnings season, investors have heard a familiar refrain from many companies. The consumer may be willing to spend, but their wallets are telling another story. With the impact of a nearly 5% rise in interest rates in about 12 months fully taking root in the economy, consumers are tapping out.  

However, according to Morgan Stanley, high-income consumers were prioritizing vacationing compared to other discretionary purchases. And almost 50% said of those surveyed indicated plans to spend more on travel. The takeaway is that the companies that cater to upper income consumers should perform well.  

And that gives you a direction for finding the best travel stocks. You’ll want to be hunting for growth and these names are in a position to deliver.   

Booking Holdings (BKNG) 

Booking Holdings (NASDAQ:BKNG) is a truth teller for the travel industry. By that I mean, it’s a premier site for consumers to book their trips. So, it doesn’t take much to draw conclusions from the company’s earnings report. People are either booking trips or they’re not. And based on the company’s second quarter 2024 earnings, they continue to book trips.  

Earnings beat analysts’ expectations by 6% and were 11.8% higher year-over-year (YOY). On the top line, the company only beat by 1%, but it was a 6% beat YOY.  

Analysts have been mixed on BKNG stock post earnings with some price targets increasing and others decreasing. But the consensus target of $4,068.32 still provides 23% upside for investors.  

Trading near $4,000 per share, some investors may be hoping that they could snap up BKNG stock at a discount if the company were to split its shares. However, the company’s CEO Glenn Fogel insists a split won’t be forthcoming and that isn’t “the kind of investor the company is looking for.” With performance like Booking is delivering it’s hard to argue against his point.  

Marriott International (MAR) 

Source: Dragon Images / Shutterstock

After a drop of over 10.8% in the last month, Marriott International (NASDAQ:MAR) stock is oversold based on the Relative Strength Indicator (RSI) as of the market close on August 7. 

But is this a buyable dip for investors? The stock is falling, in part, due to a weaker-than-expected earnings report. The headline numbers were fine both sequentially and moreso YOY. However, the company is reporting a plateau in average daily rate (ADR) growth across all brands.  

Part of the problem is coming from China where demand is weak. Nevertheless, Marriott is in the middle of a multi-year expansion in the United States and, perhaps more significantly, in Europe. This may be a case of investor having to put up with a little short-term pain for a longer term gain. Marriott is a quality name in the sector with a family of brands that stretch across many demographic groups.  

That seems to be the opinion of analysts who maintain a Neutral rating on the stock, but see a potential 14% upside in the stock price. If the consumer gets relief via interest rate those price targets will likely by moving higher.  

Viking Holdings (VIK) 

Source: StudioPortoSabbia / Shutterstock.com

Viking Holdings (NYSE:VIK) is a new kid on the block for investors. The company successfully IPO’d in May and the stock is up 13%. Frequently, post-IPO movement is fueled by hype, but for Viking there looks like there are reasons for genuine excitement.

The company’s lone earnings report was in May and it beat on the top and bottom lines. It’s not profitable yet, but if it continues to deliver results like the last quarter, that’s only a matter of time. Analysts are forecasting a 70% increase in EPS in the next 12 months. But with the stock price already within 10% of the analysts’ target price is it one of the best travel stocks to buy?

To answer that, I’ll take you back to the introduction to this article. Viking cruises appeal to the more affluent consumer that Morgan Stanley says is still spending on travel. Plus, because the cruise line doesn’t allow passengers under the age of 18 and don’t have casinos, it attracts a specific kind of traveler. And one that’s more likely to spend on sophisticated travel.  

On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.  

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.