Until Trust Is Regained, It’s Best to Avoid TUI Stock

0

The German Federal Government extended the worldwide travel warning for tourists until at least June 14. For example, the Pentecost holidays in individual federal states are affected by this, but not yet – and this is what tourism companies like TUI AG hope for – the important summer holidays. In some states, these begin on June 22nd.

A travel warning enables customers to cancel trips that have already been booked free of charge. For TUI, this should result in a further drop in sales. Nevertheless, one hopes to continue with the world’s largest tourism provider.

“The opening will probably be gradual and regional – for example, the Balearic Islands and Canaries will be able to receive guests earlier than the holiday regions on the Spanish mainland,” wrote TUI boss Fritz Joussen in a letter to the employees of the German Press Agency is present.

The focus of the season is expected to shift backwards, it says. Industry and politics should now “do everything possible to make travel possible again as far as possible”. For example, Greece, Cyprus, Bulgaria and Portugal tried to talk to Tui and were preparing “very intensively for the return of tourists”. The prerequisite for this is a gradual adjustment of flight and travel restrictions. “One must not forget that the flight restrictions will deprive us of our full business base and the countries of southern Europe will be massively weakened,” continued Joussen.

There is still great uncertainty as to when TUI can at least partially resume operations. An investment in the TUI share therefore remains a question of faith: Do you expect a “normalization” of travel traffic in the coming years or not? If you assume that TUI’s business with package tours, cruises etc. will start again next year, you can use the currently cheap level to get started.