[U.S. Stocks: Stock Discovery] Summer Stocks: Improved Performance in Summer, Increased Attention | U.S. Stocks, Industry Trends and Stock Commentary | Moneyクリ MoneyX Securities Investment Information and Media Useful for Financial Matters

Summer stocks refer to a group of stocks that see an increase in performance or attention during the summer months. Generally, this includes stocks primarily involved in beer, soft drinks, air conditioning, and travel/leisure. This time, we have picked up some summer stocks from the U.S. before the full arrival of summer.

Hilton Worldwide Holdings [HLT], a global leader in hotel groups

Hilton Worldwide Holdings [HLT] is one of the largest hotel groups in the world. As of the end of 2024, it operates 8,447 hotels (1,268,206 rooms) in 140 countries and regions.

The founder is Conrad Hilton, who started the hotel business in 1919. There are countless examples of using the founder's family name as a company or brand name, but in this case, the first name "Conrad" is also fully utilized in the hotel names. By the way, the original troublemaking celebrity is said to be a great-grandchild of Conrad Hilton.

The business model is based on a structure similar to other major hotel chains, granting franchise rights or licenses to hotel owners (including owners of hotel real estate) and receiving fees.

Franchise model: Ensuring brand quality through regular audits

The most common type is the franchise model, with 7,566 out of 8,447 hotels being of this type. Hilton receives royalties as compensation for providing the hotel owners with intellectual property rights such as brand names, trademarks, service marks, and operating systems based on the franchise agreement, but does not get involved in the operation of the hotels. The owners need to hire employees and manage the daily hotel operations.

However, Hilton conducts regular audits to ensure that brand standards are maintained and strives to uphold the quality of the brand.

Management type: Outsourcing operational tasks from the owner

The next most common type is the management type, which accounts for about 831 of the approximately 8,447 establishments. In some cases, Hilton hires employees under a contract to manage operations on behalf of hotel owners, but all costs are borne by the owner.

Ownership Type: Reaches 11% of revenue

The ownership model where Hilton owns or leases hotel real estate is limited to 50 locations, accounting for just 0.6% in terms of the number of locations. However, since the accommodation fees and dining charges directly become income, this model represents 11% of total revenue (for the fiscal year ending December 2024).

[Figure 1] Hilton Worldwide Holdings [HLT]: Performance Trends (Unit: Million Dollars) Source: Created by DZH Financial Research from LSEG *The end of the term is in December.

[Chart 2] Hilton Worldwide Holdings [HLT]: Weekly Chart (Moving Averages Green: 13 Weeks, Orange: 26 Weeks) Source: Monex Securities website (as of July 3, 2025)

Carnival [CCL], one of the largest cruise ship operating companies in the world

Carnival [CCL] is one of the largest cruise ship operators in the world. According to the company's materials, the passenger capacity in the global cruise industry for 2024 is expected to reach 733,010, of which Carnival's capacity (as of the end of November 2024) is 269,970, accounting for approximately 37% of the total.

In the industry, the trend of larger vessels is progressing alongside the popularization of cruising, but it is rather the rival Royal Caribbean Cruises [RCL] that continues to cling to the title of the world's largest. The "Wonder of the Seas," which was launched by Royal Caribbean Cruises in 2022, has a gross tonnage of approximately 230,000 tons, making it the largest in the world. However, in January 2024, the "Icon of the Seas," with a gross tonnage of 258,000 tons, will be launched, reclaiming the title of the world's largest with its own fleet.

Of course, Carnival also cannot avoid the trend of larger cruise ships to attract families and young people, but it seems they do not intend to compete on the same level as Royal Caribbean Cruises, which prides itself on being the "world's largest."

In fact, Carnival plans to launch the new cruise ship "Carnival Festival" in 2027. While the ship's name is festive, its total tonnage is 180,000 tons. It is certainly a super-large ship and will be one of the largest in Carnival's fleet, but it does not compare to the world’s largest cruise ship operated by Royal Caribbean Cruises.

As of the end of November 2024, there are 94 cruise ships, with 63 in the North America & Australia segment and 31 in the European segment. A characteristic of Carnival is its strength in the European business, where the sales for the European segment in the fiscal year ending November 2024 are expected to grow by 18% year-on-year to $7.71 billion, accounting for about 31% of total sales. In comparison, Royal Caribbean Cruises' European business ratio is around 16%.

[Chart 3] Carnival [CCL]: Performance Trends (Unit: Million Dollars) Source: Created by DZH Financial Research from LSEG *The end of the term is in November.

[Figure 4] Carnival [CCL]: Weekly Chart (Moving Average Green: 13 Weeks, Orange: 26 Weeks) Source: Monex Securities website (as of July 3, 2025)

Keurig Dr Pepper [KDP], a leader in soft drinks and coffee

Keurig Dr Pepper [KDP] is one of the leading beverage manufacturers in the United States. It was formed in 2018 through the merger of Keurig Green Mountain and Dr Pepper Snapple Group.

The main business is the production and sale of beverages and the sale of coffee. Beverage brands include carbonated drinks like "Dr Pepper," "7 Up," ginger ale "Canada Dry," fruit juice drink "Snapple," and energy drink "Ghost." Additionally, based on a partnership with France's Danone, we sell the mineral water "Evian" in the United States.

In the US coffee business, we sell home coffee makers along with coffee beans as a set. With the "Keurig" brand coffee maker, you can simply set coffee beans in special capsules to enjoy coffee shop-quality coffee at home. Of course, once you buy the coffee maker, all you need to do is purchase the coffee bean capsules.

Coffee bean capsules are produced in partnership with coffee shops such as Starbucks [SBUX], Dunkin', and Peet's Coffee, in addition to the in-house brand "Green Mountain."

[Chart 5] Keurig Dr Pepper [KDP]: Performance Trends (Unit: Million Dollars) Source: Created by DZH Financial Research from LSEG *The end of the period is December.

[Figure 6] Keurig Dr Pepper [KDP]: Weekly Chart (Moving Average Lines Green: 13 Weeks, Orange: 26 Weeks) Source: Monex Securities website (as of July 3, 2025)

Molson Coors [TAP], a German immigrant brewery origin

Germany is known as the beer kingdom, and it seems that the influence of Germans on the global beer industry is quite significant. For example, when it comes to famous beer brands in China, "Tsingtao Beer" comes to mind, but Tsingtao was a German concession before the war. The predecessor of the current Tsingtao Beer was "German Beer Tsingtao," established in 1903. Germans brought the technology of beer brewing.

In the United States, Budweiser may be the first name that comes to mind as a famous brand. The founder is Adolf Busch, a German immigrant, who changed his father-in-law's beer company to "Anheuser-Busch" and grew it significantly.

Molson Coors Beverage [TAP] can be traced back to a brewery founded by German immigrants. If you take a look at the company's website, the founders introduced are John Molson, a British immigrant, Frederick Miller, a German immigrant, and Adolf Coors, also a German immigrant.

The three individuals entered the beer business at different times and places, but as each of their businesses grew and through mergers and acquisitions, the current Molson Coors was formed. The names of the three individuals, "Molson", "Miller", and "Coors", remain as brand names of the flagship products.

Among them, it seems that the recognition of "Miller" and "Coors" is particularly high. "Miller" was a brand of SAB Miller, but in 2008, it entered into a joint venture with Molson Coors in the United States and began operations as MillerCoors. In 2016, Molson Coors acquired the remaining shares of MillerCoors and brought "Miller" under its umbrella.

The current flagship brands include "Coors Light", "Miller Lite", and "Molson Canadian" which are very popular in North America, the British lager "Carling", and the popular Croatian beer "Ožujsko".

In terms of performance, there is a concern about the declining trend in sales revenue, and in the first quarter of 2025, net profit is expected to decrease significantly, leading to a continued downward trend in stock prices. However, historically, Summer Stock has shown growth in performance during the April-June and July-September periods, and market predictions suggest a similar trend for 2025.

[Figure 7] Molson Coors Beverage [TAP]: Performance Trends (Unit: Million Dollars) Source: Created by DZH Financial Research from LSEG *The end of the term is December.

[Chart 8] Molson Coors Beverage [TAP]: Weekly Chart (Moving Averages Green: 13 Weeks, Orange: 26 Weeks) Source: Monex Securities website (as of July 3, 2025)

Southwest Airlines [LUV], Texas-based low-cost carrier

Southwest Airlines [LUV] is a low-cost carrier (LLC) based in Dallas, Texas. It began operations in June 1971 with three Boeing 737 aircraft, serving three cities within Texas for over 50 years. By the end of 2024, the number of Boeing 737s in operation has increased to 803. The number of cities served has also expanded to 117, operating in 42 states within the U.S. and Washington D.C., as well as internationally with flights primarily in Latin America, including Mexico, Jamaica, the Bahamas, and Cuba.

Known as an LLC with high customer satisfaction, it is characterized by connecting cities directly. Generally, airlines often establish hub airports, and with such a system, passengers are forced to transfer at the hub airport before heading to their destination. Southwest Airlines connects cities directly, offering many non-stop flights that eliminate the need for transfers, thereby providing customer service that saves time.

The company is often talked about as a model for LCCs, but it has a policy to further improve its services. One of these improvements is the introduction of a reserved seat system. Although priority boarding has been available in the past, a reserved seat system has not been implemented until now. Sales are set to begin in the second half of 2025, and a new reserved seat system is planned to be introduced in the first half of 2026.

We plan to introduce extra legroom seats that are wider than usual. This is part of our efforts to improve services based on customer requests and also aims to expand revenue.

[Figure 9] Southwest Airlines [LUV]: Performance Trends (Unit: Million Dollars) Source: Created by DZH Financial Research from LSEG *The end of the term is in December.

[Chart 10] Southwest Airlines [LUV]: Weekly Chart (Moving Averages Green: 13 Weeks, Orange: 26 Weeks) Source: Monex Securities website (as of July 3, 2025)