What is this world coming to when airline stocks are actually an attractive investment? The biggest airlines got a helluva lot bigger in 2014, setting the pace for growth among the largest publicly traded travel companies on the planet.
Among the 15 largest publicly traded travel companies around the world at the end of 2014, several U.S. airlines were the fastest-growing in terms of market-cap gains while European airlines and lodging and gaming companies with holdings in Macau notched the most significant declines in the ranking.
Skift ranked the market cap of the globe’s 15 largest publicly traded travel companies on January 7, 2015 and measured this ranking against the market-cap tallies we did of the 15 largest companies a year and a half ago (see second chart at bottom), on July 3, 2013.
Skift’s Top 15 Publicly Traded Travel Companies 2014
|Company||Stock Symbol||Stock Exchange||Market Cap*||Q3 2014 Revenue||Q3 2013 Rank**||2014 Rank||Market Cap Gain %|
|1. Priceline Group||PCLN||Nasdaq||$56.06B||$2.84B||2||1||32.40%|
|2. Walt Disney||DIS||NYSE||$49.76B***||$12.38B****||3||2||42.20%|
|3. Las Vegas Sands||LVS||NYSE||$43.68B||$943M||1||3||2.24%|
|4. Delta Air Lines||DAL||NYSE||$39.39B||$11.17B||5||4||149.77%|
|5. American Airlines Group||AAL||Nasdaq||$38.32B||$11.13B||NA||5||NA|
|6. Carnival Corp.||CCL||NYSE||$35.75||$4.94B||4||6||32.35%|
|7. Southwest Airlines||LUV||NYSE||$27.59B||$4.8B||13||7||197.30%|
|8. Hilton Worldwide||HLT||NYSE||$24.65||$2.64B||NA||8||NA|
|9. United Continental||UAL||NYSE||$24.0B||$10.56B||11||9||130.10%|
|10. Galaxy Entertainment||GXYEY||OTCMKTS||$21.66B||$2.23B||NA||10||NA|
|11. Marriott International||MAR||Nasdaq||$21.21B||$3.5B||9||11||72.71%|
|12. Royal Caribbean Cruises||RCL||NYSE||$18.47B||$2.38B||NA||12||NA|
|13. Host Hotels & Resorts||HST||NYSE||$17.79B||$1.29B||NA||13||NA|
|15. Ryanair||RYAAY||Nasdaq||$15.36B||$2.41B||6||15||0% (no change)|
* Market cap January 7, 2015
** Based on market cap July 3, 2013; The Real 15 Largest travel companies of 2013
*** Disney’s total market cap actually was $155.72 billion but we attempted to roughly calculate how much of it might be attributed to Disney’s parks and resorts segment, which accounted for 31.96 percent of Disney’s total revenue in Q4 of fiscal 2014. We therefore took 31.96 percent of Disney’s total market cap to estimate the portion that might be travel-related.
**** Disney’s parks and resorts revenue in Q4 of fiscal 2014
Sources: Google Finance, Yahoo Finance, public documents
While the Priceline Group, including Booking.com, retained its spot as the largest publicly traded travel company in the world during that 17-month span, growing its market cap 32.4 percent to $56.06 billion, Southwest (197.3 percent), Delta Air Lines (149.77 percent) and United Continental Holdings (130.1 percent) were the fastest growing among the top 15.
Falling jet fuel prices, airline consolidation, rising revenue from ancillary services and capacity discipline were among the factors at play.
Delta, which touts itself as the best financially run airline among U.S. carriers, had the largest market cap ($39.39 billion) among the four U.S. airlines in the top 15 companies and took fourth place, edging out American Airlines Group (5) by about one billion dollars. Southwest, which all but completed its integration with AirTran and launched its fledging international service, had the seventh largest market cap ($27.59 billion) and United was ninth ($24 billion).
Ryanair, Lufthansa and Singapore Airlines
Two European airlines, Ryanair and Lufthansa, impacted by the economic malaise in the region, as well as Singapore Airlines, didn’t keep pace with their U.S. counterparts.
Ryanair had the sixth largest market cap ($15.35 billion) among the top 15 publicly traded travel companies when Skift analyzed them in July 2013, and fell to the 15th position in Skift’s latest tally on January 7, 2015 with virtually the same market cap.
With Ryanair’s stock just spinning its wheels, that meant the low cost carrier fell a few pegs relative to the largest travel companies in the world.
Lufthansa, which was the 15th largest company in Skift’s 2013 market-cap tally, didn’t make the top 15 in Skift’s latest ranking as the Germany-based airline saw its market cap decline 15.7 percent in the 17-month period to $7.68 billion.
Singapore Airlines, which was ranked 14th in market cap in Skift’s 2013 ranking, grew its market cap 22.2 percent to $11.26 billion in the interim but that wasn’t enough to make the top 15 companies this time around.
Macau Has Its Challenges
Two lodging/gaming companies with significant holdings in Macau may have been impacted by China’s anti-corruption campaign, among other factors, and this has constrained the numbers of high-rollers ready to hit the blackjack and roulette tables in this Chinese administrative region. In the third quarter of 2014, Macau’s economy declined for the first time in several years.
Wynn Resorts, which owns a couple of resorts in Macau, saw its revenue from its Macau segment decline 5.6 percent in the third quarter of 2014. Although Wynn Resorts actually grew its market cap 11 percent to $15.05 billion in the past 17 months, the company’s position in the Skift rankings fell from eighth in 2013 to 16th in 2014, failing to make the top 15.
Likewise, Galaxy Entertainment, which develops and operates hotels and gaming facilities in Macau, has seen its market cap plummet 39.4 percent to $21.66 billion in the last five months, dropping it from 4th among the top 15 in a July 28, 2014 Skift market-cap ranking to 10th in the latest tally.
Other Notable Developments
Royal Caribbean, seemingly unburdened by Carnival Corp.’s Costa Concordia tragedy and the Carnival Triumph fiasco, two developments that adversely impacted much of the cruise industry, took the 12th spot in the 2014 ranking with a market cap of $18.47 billion. Royal Caribbean was a newcomer to the top 15 in terms of not making the list in 2013.
With airlines such as Delta and American grabbing the fourth and fifth spots, respectively, in the latest market-cap ranking, Carnival dropped from fourth in 2013 to sixth in 2014, although its market cap increased 32.35 percent to $35.75 billion, almost double Royal Caribbean’s.
Although airlines, travel technology companies (the Priceline Group and Amadeus), hotels and cruise lines were represented in the Skift top 15 market-cap ranking for 2014, car companies were shut out.
Hertz, which occupied the 12th slot in the 2013 ranking, fell out of the top 15 in the 2014 list despite marginally increasing its market cap to $10.99 billion. Hertz recently shuffled CEOs, and has been mired in accounting problems with the Securities and Exchange Commission.
Starwood was another dropout, transitioning from 10th in 2013 to not making the top 15 in 2014 despite growing its market cap 11.6 percent to $13.68 billion in 2014.
The following is a previous Skift ranking:
Skift’s Top 15 Publicly Traded Travel Companies July 2013
|1. Las Vegas Sands||$42.72B||$11.1B|
|3. Walt Disney*||$34.99B||$12.9B|
|4. Carnival Corp.||$27.01B||$15.4B|
|5. Delta Air Lines||$15.77B||$36.6B|
|8. Wynn Resorts||$12.74B||$5.1B|
|11. United Continental||$10.43B||$37.1B|
|13. Southwest Airlines||$9.28B||$17.1B|
|14. Singapore Airlines||$9.21B||$11.6B|
* Disney’s total market cap was actually $114.56B, and we attributed $34.99B of it to “travel;” in fiscal year 2012 Disney Parks and Resorts unit generated 30.55% of Disney’s total revenue.
Sources: Google Finance, Bloomberg, company financial reports
Photo credit: Skift found that Delta's market cap was the fastest growing among top travel companies in a 17-month span. Pictured, Delta Air Lines CEO Richard Anderson speaks during a press conference in Tokyo, Tuesday, July 30, 2013. Itsuo Inouye / Associated Press