Vacation season means cash for these companies.
There’s about a month left of summer, before the grind of back-to-school obligations and the dawn of cooler fall weather. Many families are planning to make the most of this remaining time. As the travel season winds down, consumer spending metrics are strong. Consumer confidence hit a 17-year high earlier this year and record-low unemployment means more Americans have money in their pockets. While summer fashions come and go, there are trusted companies that consistently tap into seasonal travel demand and return a share of that cash back to investors. If you’re looking for go-to travel stocks that give back, here are seven dividend payers worth considering.
Carnival Corp. (ticker: CCL)
One of the biggest cruise lines on the planet, Carnival is valued at $40 billion and operates about 100 ships. While the company sails year-round, it does a brisk business in summer with travelers headed to tropical destinations as well as Alaska and Singapore. Carnival had a rocky few months as the stock market grew more volatile in 2018, however strong consumer spending continues to support decent revenue and profit expansion. And with a dividend that is less than half of its projected 2018 earnings, the income stream from shares is very safe and ripe for future increases.
Current yield: 3.5 percent
Ashford Hospitality Trust (AHT)
Ashford is a $1 billion real estate investment trust, or REIT, that focuses primarily on upscale, full-service hotels and resorts from Florida to Alaska. A few of the nameplates on its 100-some properties include Ritz-Carlton, Crowne Plaza and Embassy Suites. Catering to well-off clientele means better margins and better reliability, since visitors with deep pockets will keep shelling out the cash even in a modest downturn for the broader economy. This helps support reliable revenue, and a reliable dividend.
Current yield: 5.7 percent
Dine Brands Global (DIN)
Operating well-known restaurants Applebee’s and IHOP, Dine Brands manages more than 3,500 locations in the U.S. and abroad. In addition to its own locations, DIN also licenses franchising rights for both of these chains to other operators. Things are stable over the long term at Dine Brands, given this broad reach and its strong brands. And after a short-lived pull back January, shares have snapped back over 35 percent so far this year. That’s on top of reliable and generous dividends.
Current yield: 3.4 percent
Las Vegas Sands Corp. (LVS)
One of the biggest casino operators in the world, Las Vegas Sands operates venues well outside of Nevada — including lucrative destinations in Singapore and the Chinese gaming destination of Macau. It’s this international footprint that gives LVS such strong growth metrics over the last several years. And as they say in gambling, “the house always wins.” That means a pretty reliable revenue stream from existing operations even as Las Vegas Sands continues to bring new venues online around the world. The dividend has more than doubled in about five years and there’s also dividend growth ahead if favorable performance persists.
Current yield: 4.1 percent
Chesapeake Lodging Trust (CHSP)
Similar to Ashford but roughly twice the market value, Chesapeake Lodging Trust is a $2 billion REIT with “upper-upscale” hotels. The difference is a geographic focus that limits CHSP to major urban markets. Though the portfolio is targeted with just 21 hotels in eight states, the stock is valued more than some of its peers based on the quality of its properties. The dividend is also high quality, since REITs must deliver 90 percent of taxable income back to investors. That mandate for a share of the profits means constant and growing dividends for CHSP shareholders.
Current yield: 4.9 percent
Brinker International (EAT)
The vast majority of the restaurants owned and operated by Brinker are under the Chili’s Grill & Bar brand name, with about 1,700 locations in the company’s portfolio. The $2 billion company has been doing well lately despite a volatile market with a nearly 30 percent gain since Jan. 1, thanks in part to strong consumer spending trends. Dividends have nearly tripled since 2010, from 14 cents quarterly to 38 cents quarterly at present. A strong appeal with consumers coupled with a general lift for cyclical stocks in the restaurant industry bodes well for EAT.
Current yield: 3.1 percent
Ryman Hospitality Properties (RHP)
Ryman is another lodging REIT, but differs in that it operates in association with destinations. These include locations under the Gaylord brand including a recently-constructed convention center and resort in the District of Columbia, as well as the legendary Grand Ole Opry in Nashville, Tennessee. These anchors provide a built-in draw for its properties that not only help RHP take advantage of cyclical trends when consumers are traveling more but also offers baseline demand if times get tight. The result is a substantial and reliable dividend that is music to investors’ ears.
Current yield: 4 percent
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7 Travel Stocks For Income Investors originally appeared on usnews.com
