The impact of COVID-19 outbreak on hotels' value compared to previous diseases: the role of ALFO strategy

An impact assessment of the COVID-19 pandemic on Japanese and US hotel stocks

This study proposes two new regime-switching volatility models to empirically analyze the impact of the COVID-19 pandemic on hotel stock prices in Japan compared with the US, taking into account the role of stock markets. The first model is a direct impact model of COVID-19 on hotel stock prices; the analysis finds that infection speed negatively affects Japanese hotel stock prices and shows that the regime continues to switch to high volatility in prices due to COVID-19 until September 2021, unlike US stock prices. The second model is a hybrid model with COVID-19 and stock market impacts on the hotel stock prices, which can remove the market impacts on regime-switching volatility; this analysis demonstrates that COVID-19 negatively affects hotel stock prices regardless of whether they are in Japan or the US. We also observe a transition to a high-volatility regime in hotel stock prices due to COVID-19 until around summer 2021 in both Japan and the US. These results suggest that COVID-19 is likely to affect hotel stock prices in general, except for the influence of the stock market. Considering the market influence, COVID-19 directly and/or indirectly affects Japanese hotel stocks through the Japanese stock market, and US hotel stocks have limited impacts from COVID-19 owing to the offset between the influence on hotel stocks and no effect on the stock market. Based on the results, investors and portfolio managers should be aware that the impact of COVID-19 on hotel stock returns depends on the balance between the direct and indirect effects, and varies from country to country and region to region.

The impact of the Covid-19 pandemic on the hotel Industry's economic performance: Evidence from Portugal

This paper estimates the impact of the Covid-19 pandemic on the economic and financial performance of the Portuguese mainland hotel industry. For that purpose, we implement a novel empirical approach to gauge the impact of the pandemic during the 2020-2021 period in terms of the industry's aggregated operating revenues, net total assets, net total debt, generated cash flow, and financial slack. To that end, we derive and estimate a sustainable growth model to project the 2020 and 2021 'Covid-free' aggregated financial statements of a representative Portuguese mainland hotel industry sample. The impact of the Covid pandemic is measured by the difference between the 'Covid-free' financial statements and the historical data drawn from the Orbis and Sabi databases. An MC simulation with bootstrapping indicates that the deviations of the deterministic from the stochastic estimates for major indicators vary between 0.5 and 5.5%. The deterministic operating cash flow estimate lies within plus or minus two standard deviations from the mean interval of the operating cash flow distribution. Based on this distribution, we estimate the downside risk, measured by cash flow at risk, at 1294 million euros. Overall findings shed some light on the economic and financial repercussions of extreme events such as the Covid-19 pandemic, providing us with a better understanding of how to design public policies and business strategies to recover from such an impact.

The role of capital structure management in maintaining the financial stability of hotel firms during the pandemic-A global investigation

Due to the detrimental effects of the Covid-19 pandemic on the hotel sector, pandemic crisis management research has received lots of academic attention, from studies in sales-marketing to human resource management. However, financial management has been largely overlooked in the agenda of pandemic crisis management and hotel resilience. Therefore, this paper aims to address the research gap by exploring the role of capital structure management in maintaining financial stability and resilience capacities of hotel firms during this evolving and unpredictable Covid-19 pandemic. Using a database of 1882 firm-quarter observations of 196 hotel firms in 30 countries from Quarter 3 2018 to Quarter 2 2021, it is found that low debt capital structure mitigates the adverse impact of the pandemic on hotel firms' financial stability during this turbulent time; particularly the negative impacts caused by government restrictions on both domestic and international travel. The benefit of low debt levels is more pronounced for more vulnerable hotels such as small, less diversified, and slow growing hotel firms. Also, hotel firms that have less long-term debt are more financial stable and resilient during pandemic period. Research outcomes suggest that financial management, in particular capital structure policies should be a critical part of hotel resilience building and crisis management strategy for hotel firms.

Self-restraint, subsidy, and stock market reactions to the coronavirus outbreak: Evidence from the Japanese restaurant industry

This study examined the stock market response of the Japanese restaurant industry to the announcement of the self-restraint request and subsidy for restaurants by the Japanese government during the coronavirus outbreak. Using the event study approach, it was found that the market reacted negatively to the self-restraint request and positively to the subsidy for restaurants. Following the announcement of the self-restraint request, investors in the restaurant industry responded positively to the government's stringent policy responses. Conversely, following the announcement on the "dining-out" subsidy, investors reacted negatively to the stringent government policies. Our findings provide useful information for policy makers and practitioners to mitigate losses in the hospitality industry during the pandemic.

COVID-19 staycations and the implications for leisure travel

The COVID-19 pandemic has prompted the re-emergence of staycations to the fore, as many people were forced to spend their vacations at or close to home due to travel restrictions. This phenomenon first went mainstream during the 2008 financial crisis, and has now been further accelerated by the COVID-19 pandemic. This study investigated the growth and practice of staycations during the first two years of the pandemic by analyzing social media and internet search data using Latent Dirichlet Allocation (LDA) topic modeling and Google Trends analytics. Key findings suggest that, while spatially close to home, people tried to achieve a psychological distance away from home. This was demonstrated by a strong global search interest in spending staycations at hotels close to home. The optimal LDA topic model produced 38 topics which were classified under four aggregate dimensions of antecedents, attributes, activities, and consequences of staycations. The findings provide useful insights to managers and policymakers on boosting revenue through this practice, and the role of staycations in promoting leisure activities close to home and sustainable tourism.

Are Customers Happy with Robot Service? Investigating Satisfaction with Robot Service Restaurants during the COVID-19 Pandemic

The COVID-19 virus has led to a rapid increase in demand for robot service restaurants. However, given the novelty of both, little is known regarding the impact of this technology on consumer attitudes in the time of the pandemic. Using a sample of customers with dining experiences in Muscat-based robot service restaurants, the current study investigates the factors that affect experience satisfaction and experience extension. The results demonstrate that perceived usefulness, speed of service, and experience novelty directly influence experience satisfaction, while perceived enjoyment and experience satisfaction directly influence experience extension. Moreover, novelty seeking moderates the effects of experience novelty and perceived enjoyment on experience satisfaction, as well as the impact of perceived enjoyment on experience extension. Lastly, perceived risk reduction of infection and trust are found to moderate the impact of experience satisfaction on experience extension. Theoretical and practical implications are offered.

CSR in Education on Business Confidence: Mediation Effect of Corporate Reputation in the Peruvian Banking Sector

This paper analyzes the direct influence of CSR educational actions on business confidence in the context of the banking sector in an emerging country (Peru). A mediating effect through corporate reputation is also analyzed. To test the hypotheses presented in this paper, we have sent a survey to 1745 executive officers of the branches of the banks. These key individuals were selected as the target population of the study because the authors sought to study the management’s perception of CSR and business confidence. From the data obtained from the survey, it has been tested that educational CSR actions in Peruvian banks directly influences the perception of business confidence. Secondly, this relationship is partially mediated by the effect of CSR educational actions on corporate reputation.