The Company Best Positioned to Play the New Golden Age of Travel
 |
| By Michael A. Robinson |
When it comes to traveling in Europe, what a difference a year makes.
At this time last summer, I noted that my wife and I were getting ready for a trip to Italy, Croatia and Greece.
And we were going despite a nasty currency headwind.
The dollar had just suffered its worst first half in more than 50 years, plunging nearly 11% against a basket of major currencies.
Earlier this year, the dollar finally began heading back in the right direction.
In fact, when Tracy and I booked our upcoming European trip several months ago, we were getting a much better deal against the euro.
Well, as the headlines shift, so does the value of the dollar. It has softened once again.
But Tracy and I couldn’t care less.
We’re headed to Portugal, Spain and France, which we’ll visit aboard a luxury cruise ship.
And we are far from alone. Despite the dollar’s gyrations, people are traveling like never before.
And today I want to show you a little-known company riding that boom that’s on pace to roughly double its earnings in just three years …
The Skies Are Getting More Crowded
Now then, I personally understand why the dollar’s shifting value is having so little impact on foreign travel.
For us, our life plan calls for seeing as much of the world by luxury cruise as we can.
In fact, we’ve already booked a trip for next year that sails from Stockholm to Copenhagen.
And we expect to book a trip to the Bahamas during next year’s Christmas break, where we also plan to host our adult daughters.
On paper, the travel boom makes a lot of sense.
Millions of boomers have retired and have both the money and the time to see the world. Young people are a big part of the trend as well.
And if there’s one thing we learned from Covid, it’s that once the lockdowns ended, people had an intense hunger to see the world.
600 Million More Passengers in the Air
Consider this — in 2019, the last full year before Covid, airlines carried about 4.5 billion passengers.
European analysts say travel to there from the U.S. was up 5% for the first six months of this year. And the International Air Transport Association expects airlines to carry more than 5.1 billion passengers this year.
That’s roughly 600 million more passenger journeys than before the pandemic.
Even more impressive, airlines are expected to fill roughly 84% of their available seats — an all-time record.
Think about that for a moment.
Not only are more people flying than ever before. They’re packing planes at a rate the industry has never seen.
Even better, travelers are opening their wallets.
Americans expect to spend an average of $6,354 on travel this year. That’s up 12% from 2025.
And nearly seven in 10 Americans say they’ve increased their travel budgets this year.
For baby boomers, the increase is even more dramatic. They expect to spend 19% more on travel this year.
That’s a powerful combination. And it’s creating a huge tailwind for the companies that supply the technology needed to keep the world’s growing aviation fleet connected, efficient and in the air.
Jetliners in Huge Demand
On the supply side, the story is just as bullish.
Boeing (BA) has one of the most respected long-term outlooks in aviation.
And its latest forecast says this travel boom has a long way to run.
The company expects global air travel to double over the next 20 years.
Meeting that demand will require nearly 44,000 new commercial aircraft through 2045.
By then, Boeing expects the global commercial fleet to grow nearly 80% to more than 50,000 aircraft.
Put it all together, and Boeing sees a staggering $7.8 trillion market for new commercial airplanes over the next two decades.
That brings me to GE Aerospace (GE).
Following a corporate split-up that was completed in early 2024, it emerged as an efficient supplier.
It ranks as one of the dominant forces in commercial jet engines.
Through GE Aerospace and its CFM International joint venture with Safran, its engines power a huge portion of the world’s commercial aircraft.
It’s also a major defense contractor.
GE engines power U.S. fighter jets, transport aircraft and helicopters.
And the company is pushing into another huge growth market through AiXROS, its autonomous systems business focused on drones and other unmanned aircraft.
In other words, this isn’t just about legacy jet engines.
GE Aerospace has its hands in some of the most important trends shaping the future of flight — from more efficient commercial engines to defense, drones and autonomous systems.
The Earnings Engine
What a turnaround we have here for this huge sector.
Just months ago, we saw plenty of headlines suggesting that tariffs would keep foreign travelers away from the U.S.
But the recent World Cup was a massive travel success.
It drew a record of more than 6.8 million spectators to its 104 matches across the U.S., Canada and Mexico.
Add it all up and you can see why the travel boom is expected to last at least another 15 years. Standing at the center of it all is GE Aerospace.
And remember, commercial aviation is only part of the story. GE also gives us powerful hooks into defense, drones and autonomous flight.
All that demand is translating into profits. In the most recent quarter, GE Aerospace grew per-share profits by 24%.
If, as I expect, the company can keep growing earnings at roughly that rate, we’d see earnings roughly double in just over three years.
Think about that.
One of the most storied names in American industry is now positioned at the heart of a historic global travel boom — with defense and drones adding even more fuel to the fire.
That’s the kind of earnings power that can put some serious jet fuel in your portfolio.
Best,
Michael A. Robinson
P.S. On Tuesday, my colleague Chris Graebe is hosting a special event to unveil a tech that will rival AI and a small, pre-IPO company at the heart of it. Grab your spot here. I’ll be watching.
1https://www.tradingview.com/chart/?symbol=TVC%3ADXY
2https://www.iata.org/en/iata-repository/pressroom/fact-sheets/industry-statistics/
3https://www.geaerospace.com/commercial/aircraft-engines/genx
