UBS Says These 4 Pandemic-Thrashed Stocks Have Become Cheap Relative To Their Earnings

The benefits of reopening post-pandemic have not yet been factored in for these four stocks relative to their earnings, according to UBS analysts.

TripAdvisor Inc TRIP: The travel company’s shares have risen marginally by 1.84% on a year-to-date basis, but underperformed the S&P 500, which has shot up 14.5% in the same period.

The shares have risen nearly 18% since Nov. 9, when Pfizer Inc PFE released data from its phase 3 trial.

Choice Hotels International, Inc CHH: Choice Hotels is yet another travel-related stock, which according to UBS is cheap on “normalized earnings.” Choice Hotels shares have shot up 1.7% since the positive developments around the vaccine on Nov. 9. The stock has returned 4.79% on a YTD basis.

Zimmer Biomet Holdings, Inc ZBH: Another UBS pick, the prosthetic hip maker’s revenue fell 38% year-over-year during the second quarter but then rebounded in the summer. On a YTD basis, the shares of the Indiana-based company have declined by 0.42%. 

Alliance Data Systems Corp ADS: Alliance Data shares have fallen 25.48% for the year. The provider of loyalty and marketing services was removed from the S&P 500 this summer along with Harley-Davidson Inc HOG and Nordstorm Inc JWN, which likely came in the way of the company rebounding from its lows in the spring, according to UBS researchers.

Price Action: On Friday, TripAdvisor shares closed 8.18% higher at $30.94, Choice Hotels shares closed 4.17% higher at $108.38, Zimmer Biomet shares closed 1.92% higher at $149.05 and Alliance Data Systems shares closed 1.41% higher at $83.61.