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Additional Reading from MarketBeat Media What a "Normal" Economy Could Mean for These 3 Travel StocksSubmitted by Chris Markoch. Article Posted: 1/2/2026. 
Article Highlights - Travel and leisure stocks could benefit from a “normal” economy as sector rotation puts an emphasis back on companies with solid fundamentals.
- Carnival, Booking Holdings, and Marriott show improving earnings trajectories and potential upside into 2026.
- Analysts forecast earnings growth above historical averages, signaling renewed confidence in consumer travel demand.
What would a “normal” economy look like in 2026? For starters, many investors would like to see the recent sector rotation continue. That would allow growth to expand beyond the tech sector, and specifically, beyond stocks tied to the artificial intelligence (AI) trade. It's been a lucrative run for many. But outside the Magnificent 7, a number of these names were trading on sentiment more than fundamentals. In too many cases, profitability remains years away (if it ever arrives), and several companies are generating little to no revenue. A tiny government task force just wrapped up 20 years of work.
And buried in their federal filings, I found something remarkable:
American citizens now have a legal birthright claim to something previously inaccessible.
Under U.S. law, you can stake your claim right now. The name and ticker are available here now >>> Sector rotation would put fundamentals back in focus. One sector likely to be scrutinized in that environment is travel and leisure. Despite concerns about consumers' financial health, travel demand has stayed strong. That trend supports the idea that travel stocks could revert toward their historical averages for earnings growth. Earnings growth is one of the best predictors of stock-price appreciation, but an abnormal economic backdrop over the past five years has made buy-and-hold and longer-term investing more difficult. Traders, too, have found it challenging to remain long through such volatility. A more normalized earnings outlook could change that risk dynamic for both investors and traders. Here are three travel and leisure names to watch. Carnival Cruise Lines: Normalization Could Drive Earnings Recovery If you owned shares of Carnival Corporation (NYSE: CCL) five years ago, you'd be pleased to have seen a gain of more than 41%. CCL collapsed in 2020, and its revenge-travel rebound has since been challenged by inflation and higher interest rates. The stock remains well below its pre-pandemic peak, but earnings trends suggest the turnaround may have legs. Over the last five years, Carnival posted an average annual decline in earnings per share (EPS) of roughly 19%. That changed in 2024: Carnival returned to profitability, closed the year with a full-year record for net income and posted a 20-year high in return on invested capital (ROIC). The company has also made meaningful progress reducing the heavy debt load it accumulated in 2020 and has reinstated its dividend. Analysts currently forecast roughly 18% earnings growth in 2026, driven by strong bookings. That projection is materially higher than Carnival's 10-year average, which has been flat to slightly negative. The past five years were extreme; a reversion toward normal would be welcome news for Carnival and its shareholders. Booking Holdings: AI-Enhanced Efficiency Supports Steady Growth Booking Holdings Inc. (NASDAQ: BKNG) has rewarded shareholders with a gain of more than 140% over the past five years, powered by strong earnings growth that averaged over 83% annually across the last three years. Normalization of earnings in 2025 helps explain why BKNG was only up about 7.7% that year. The company's business model remains sound and is being enhanced by AI tools that improve efficiency. Heading into 2026, earnings are likely to remain the key driver for BKNG. As 2025 closed, analysts assigned a consensus price target of $6,149.93, implying a roughly 14.8% upside, supported by expected earnings growth of more than 18% — well above its 10-year average EPS growth of about 14%. Booking Holdings isn't for every investor: the absolute share price may be off-putting, and the stock trades at a P/E of around 34x, a modest premium to its historical average. The company has also said it does not plan to split its shares. Management frames that choice as a way to encourage long-term ownership, and BKNG has been a strong compounder for investors comfortable with its price level. Marriott: Luxury Positioning May Anchor Demand in 2026 Even an 18.5% rally in the final three months of the year wasn't enough to keep Marriott International (NASDAQ: MAR) from lagging the broader market. Shareholders still realized about 11% price appreciation for the year and collected a dividend yielding roughly 0.83% at year-end. A primary growth driver for Marriott is its increasing focus on the higher-end, luxury segment. Luxury travelers tend to be less price-sensitive and are more likely to prioritize travel spending. The 11% gain for the year trails the roughly 27% average gain over the past five years. Once again, earnings explain much of the disparity: Marriott's average EPS growth surged to about 36% over the last three years as travel demand accelerated, while a more normalized, 10-year average EPS growth is closer to 12%. Analysts project EPS growth around 15.8% in 2026, and sentiment is broadly bullish. As a mature operator, MAR is generally a stock to own for the long term rather than trade. It currently trades at a slight premium, which may prompt some investors to wait for a better entry. Marriott reports Q4 fiscal 2025 results in February, which should provide clearer guidance for 2026 expectations.
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