The Great Reopening — 3 New Summer Trades to Consider
Ring the bells and sound the trumpets — “the Great Reopening” is here.
We can finally ditch the masks and get back to normal.
Or can we?
We have hosts of people who once followed CDC guidelines to a T throughout the pandemic now wholeheartedly resisting the new CDC guidelines that say you can relinquish “masking up” and other things if fully vaccinated. The politics around masking up and what is safe as more and more folks become vaccinated boggles the mind.
Whichever way your community breaks on the issue, one thing is for sure: A lot of people welcome the idea of returning to “normal” in theory but are changing the way they define normal at the same time.
I think one of the important questions to consider as we move into the “Great Reopening” is what precedents set by the pandemic will be lasting and which ones will fade away?
I don’t think we will know the answer for some time. Sure, right now in many places you can go to an event like a baseball game or out to dinner or to the zoo and it kind of feels pretty normal, but not wholly.
Call me old-school, a food-and-beverage insider, a connoisseur, or an elitist if you will, but to me, dining out is not enjoyable.
I went to the Guinness brewery just outside Baltimore the other weekend. The setting was idyllic, the band was rocking, and the weather was perfect for enjoying drinks at one of the tables on the pavilion.
We ordered our food and drink via QR code. It was warm out and we wanted water for the table too. No such option on the e-menu. No servers in sight. Not even a water jug for self-service, so no waters. A little later, the food arrived. One dish was just terrible — completely undercooked and inedible. Was there a QR code for that? Of course not.
Then I went golfing the next day. I was very much looking forward to the outing. I knew the course would be busy, but waiting 15 minutes at every tee box for the fairway to clear is just unbearable. Our foursome finished in just under five hours! And I was lucky to get a tee time. In my area, golfing is so popular now that you need to book three weeks in advance!
Last weekend, I went camping with a huge group of people. I think there were about 50 of us in total.
Now, when I camp, I keep it rugged. But I’d say about 75% of the campers in my group and at Westmoreland State Park in general think “glamping” (glamorized camping) is the way to go. So they roll in with their $200,000 Winnebagos or Mercedes Forester RVs, set up movie screen projectors, full kitchens, basketball hoops, and all other types of stuff.
The bottom line is the pandemic has changed a lot over the past 12 months, including the ways people enjoy their leisure time. Droves of people who were once big moviegoers, foodies, and mall rats have reestablished their love for outdoor activities over the past 12 months, and I think this trend will be a lasting one
And with that theme in mind, I have three stocks on my radar that you’ll want to consider trading through the summer.
Three Stocks for Summer
Since dining out is still following a pandemic business model in a post-pandemic world, I think restaurant group stocks are headed for trouble. For one thing, a labor shortage of quality servers and bartenders is an issue. Plus, on the macro side, rising delivery and food costs will raise prices for consumers. Paying more for worse service doesn’t add up.
My No. 1 choice here is Kroger Co. (NYSE: KR). Kroger is a supermarket and wholesale grocery retailer with a massive portfolio of chains, including my favorite grocery store, Harris Teeter.
Why go to the local tiki bar — where a bar brawl between drunk, sunburned boaters could ruin an overpriced day — when you could throw your own killer barbecue with dry-aged steaks and Alaskan king crab?
My next choice pays homage to those who have truly reestablished their inner outdoorsman — men and women alike — and are still camping, boating, and RVing in droves.
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Here’s an insider tip: If you want to go camping this fall, you better book now. Sites are selling out everywhere in record clips.
Campsites on Assateague Island are already booked all year. Yosemite and other famous parks are booked more than a year out.
And like I mentioned earlier, these folks aren’t pitching a tent and roughing it like I do. They are coming with big expensive RVs, toys, and everything else under the sun.
Our most direct access to this boom in outdoor recreation is through Winnebago Industries (NYSE: WGO). The setup technically also looks good with a recent double top behind us and shares coming out of a double bottom right now.
We’ll just have to keep an eye on oil and gas prices, which could put some pressure on WGO.
Airline fights, hotel bar brawls, stadium rumbles, and melees at Disney are becoming all too normal.
Trust me, I’m pretty rough around the edges. I've had a few scraps in my younger years, and a bar fight doesn’t phase me much.
But do I want to bring my girlfriend, wife, children, elderly parents, etc., into a place where the wrong word or two to the wrong person will set off an explosion of fisticuffs?
The most recent story of a flight attendant getting her teeth knocked out was the last straw for me. I can pass on all that crap, and I will pay extra to avoid dealing with the riffraff of America.
Therefore, I’m extremely bearish on the U.S. airlines and econo-style vacation stocks and very bullish on the higher-end offerings in these sectors.
Need an airline that won’t leave you bruised and battered like Southwest or Spirit Airlines? Consider a stake in Delta Air Lines (NYSE: DAL), which is most consistently ranked as America's highest-end airline — that’s publicly traded.
To your wealth,
Editor, Energy and Capital
After spending 10 years in the consumer tech reporting and educational publishing industries, Sean has since redevoted himself to one of his original passions: identifying and cashing in on the most lucrative opportunities the market has to offer. As the former managing editor of multiple investment newsletters, he's covered virtually every sector of the market, ranging from energy and tech to gold and cannabis. Over the years, Sean has offered his followers the chance to score numerous triple-digit gains, and today he continues his mission to deliver followers the best chance to score big wins on Wall Street and beyond as an editor for Energy and Capital.
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