Bank Of America Sees Mixed Signals In Leisure Sector, Highlights Strength In Premium Travel And Cruise Stability

Bank of America Securities offered a cross-sector analysis of the leisure consumer space on Thursday, outlining recent performance trends across several key segments.

The firm notes that while trends vary by category, segments like cruises and premium travel continue to show steady performance, whereas more value-focused areas are facing weakness.

In the lodging sector, BofA notes that aggregated credit and debit card data for April spending showed a 3% year-over-year decline, in line with March figures.

The firm also sees weakness in its Las Vegas room rate survey, with forward rates down 11%.

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Analysts suggest that BofA's card data skews toward leisure spending and aligns with commentary from Hilton Worldwide Holdings Inc. HLT, Hyatt Hotels Corporation H, and Marriott International MAR, all of which noted softer low-end RevPAR trends.

In the timeshare segment, performance remains steady despite broader uncertainty.

On the ski front, Vail Resorts, Inc. MTN reported a 3% drop in ski visits this season, underperforming the overall industry, which was up 2%. The lag may be linked to softer non-pass lift ticket sales, which are typically booked during the season and carry a higher price.

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Looking ahead to next season, while the number of passes sold is down, total dollars collected are up through April 20. BofA adds that Memorial Day is typically a key trigger for pass sales, but an uptick in web traffic has yet to materialize.

For cruise, BofA notes that based on aggregated monthly debit and credit card data, spending has slowed from the strong double-digit growth seen late last year to flat year-over-year in April.

While some of this decline may be attributed to the timing of Easter, economic uncertainty over the past few months has also likely played a role.

Norwegian Cruise Line Holdings Ltd. NCLH specifically flagged a slowdown in booking activity, especially for longer European sailings. Royal Caribbean Cruises Ltd. RCL kept its full-year 2025 net yield guidance unchanged, breaking from the usual pattern of upward revisions.

Overall, cruise operators remain well booked for 2025 and still have time to secure additional bookings for 2026 as the year progresses, BofA notes.

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