While the Omicron variant threw a wrinkle into the economic recovery, it’s now been a few months. And some in-person events have been cancelled or scaled back as a result, but it’s becoming a rarer and rarer phenomenon.
That points towards further gains in the travel and tourism sector, which already saw big gains in the past year. Simply put, consumers want to get out, explore the world, and spend money on new places and experiences.
One area where this will likely remain in full swing is in Las Vegas. That’s likely why casino plays, which cater to travel and tourism, can continue to perform strongly.
MGM Resorts International (MGM) was a strong winner last year, with a 42 percent gain for shares, far more than the overall market. But with room for further growth in travel and tourism this year, the hot streak for shares can continue.
The casino and hotel operator nearly broke even in 2021 alone, and with revenue up 140 percent off of 2020’s average, the trend is in place for an even better year this year.
Action to take: Investors can buy shares here well off their 52-week highs of $51, although they won’t get enough income off of the penny annual dividend.
A better trade might be the June $50 calls. Last going for about $2.80, the calls would move in-the-money if shares went back to their 52-week high in the first half of the year. Traders can likely nab mid-to-high double-digits on a jump higher in shares in that timeframe.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.