Citibank analysts say positive news about the development of a Covid-19 vaccine by Pfizer and BioNTech is likely to keep cyclical stocks cheerful for some time. An effective vaccine means "the light at end of the tunnel that gives hope ending the vicious cycle of a rise in infections and economic lockdowns causing economic damage," and other vaccine developers are likely to come up with similar encouraging developments.
But, even if a vaccine is released next year, the battered hotel industry may take several years to recover. S&P Global Ratings says a "solid recovery isn't likely" until 2023 -- and that's based on a widely available vaccine becoming available in the second half of 2021. In a worrisome stat for hotel companies, year-over-year revenue per available room, which is a closely watched metric for gauging hotel health, has decreased 50% in 2020. S&P forecasts that will rebound slightly in 2021, but will still remain between 20% and 30% lower compared to 2019.
