As the Thanksgiving holiday looms, major airlines including United Airlines (UAL), Delta Airlines (DAL), and American Airlines (AAL) are bracing for a boom in air travel. According to the Airlines for America (A4A), a body representing major U.S. passenger and carrier airlines, major airlines expect record demand for air travel.
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Airlines are projecting around 30 million travelers over the 11-day Thanksgiving travel period between November 17 and November 27, an all-time high. A4A expects that around 2.7 million passengers will fly per day over the holiday, up by 9% year-over-year, while November 26, the Sunday after Thanksgiving is projected to be the busiest day of the holiday period, with air passengers hitting 3.2 million.
Even the Transportation Security Administration (TSA) expects this holiday to be its busiest ever and expects to screen 30 million passengers over the 12-day Thanksgiving period from November 17 to November 28.
Specifically, TSA expects to screen 2.6 million passengers on Tuesday, November 21, 2.7 million passengers, and 2.9 million passengers on November 22 and November 26, respectively. TSA Administrator David Pekoske commented, “We expect this holiday season to be our busiest ever. In 2023, we have already seen seven of the top 10 busiest travel days in TSA’s history.”
The surge in travel is expected to be restricted to not just air, but will be seen on the road, too! The American Automobile Association (AAA) anticipates 49.1 million travelers getting behind the wheel this Thanksgiving, up by 1.7% year-over-year.
Is IYT a Buy?
For investors interested in getting exposure to the transportation sector, the iShares US Transportation ETF (IYT) offers a good option. Turning to Wall Street, analysts have a Moderate Buy consensus rating on IYT ETF based on 29 Buys,15 Holds, and two Sells assigned in the past three months, as indicated by the graphic below. The average IYT price target of $272.05 implies an upside potential of 19.1% at current levels. The IYT ETF has gone up by more than 7% year-to-date.
