The stock price reaction of the COVID-19 pandemic on the airline, hotel, and tourism industries

This paper investigates the stock market performance from the second half of February through the latter portion of March 2020 for U.S. travel-related firms (airlines, restaurants, and hotels) in response to the COVID-19 pandemic. Clearly the reduction in travel was negative news for the travel indu...

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Detalles Bibliográficos
Autores principales: Carter, David, Mazumder, Sharif, Simkins, Betty, Sisneros, Eric
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Elsevier Inc. 2022
Materias:
Article
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8733894/
https://www.ncbi.nlm.nih.gov/pubmed/35013674
http://dx.doi.org/10.1016/j.frl.2021.102047
Descripción
Sumario:This paper investigates the stock market performance from the second half of February through the latter portion of March 2020 for U.S. travel-related firms (airlines, restaurants, and hotels) in response to the COVID-19 pandemic. Clearly the reduction in travel was negative news for the travel industry; however, we focus on the factors used by market participants to price the information into stock prices. We find that larger firms with greater cash reserves and higher market-to-book ratios experienced less negative returns, while firms with greater leverage were penalized more. Additionally, we find that cash reserves were particularly important for hotels.

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