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I've been hard on Norwegian Cruise Line this year, and ranking it third in a three-dog race may seem like another insult. The company has seen its share count and long-term debt increase 26% and 73%, respectively, through the first nine months of this year, and that's not bueno. Its larger rivals have pumped their debt loads by more, but no one has done its future per-share profitability more harm during the lull than Norwegian Cruise Line with all of the new shares printed in 2020. Travel stocks in general have been bad bets for investors in 2021, and cruise line stocks are among the industry's biggest losers. There are just three major publicly traded players, but they're not all built the same.
COZUMEL MARKS THE SPOT: ROYAL CARIBBEAN ANNOUNCES NEW ROYAL BEACH CLUB IN MEXICO
Why Norwegian Cruise Line Stock Dropped 11% Last Month - The Motley Fool
Why Norwegian Cruise Line Stock Dropped 11% Last Month.
Posted: Mon, 05 Feb 2024 08:00:00 GMT [source]
#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day. It's quite possible that 2021 is a bull market for cruise line stocks, even if the general market doesn't play along.
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11 Best Cruise Stocks To Buy Now - Yahoo Finance
11 Best Cruise Stocks To Buy Now.
Posted: Mon, 04 Mar 2024 08:00:00 GMT [source]
It should repeat the feat in 2021 as it leads the way back to revenue-generating cruises. "We're seeing shoppers and cruise bookings increase week after week, which is fantastic news for the industry." Royal Caribbean (RCL 1.23%) is distinguished as being one of the most innovative cruise lines. Its ships are packed with state-of-the-art amenities, including virtual balconies, massive water slides, skydiving at sea, and even Broadway shows. While Norwegian Cruise Line currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.
Carnival Corp & plc paired Past Events
There are also economies of scale here, and the $20.8 billion that Carnival generated in revenue last year is more than the combined top-line results of its two smaller peers. As of the date this article was written, the author does not own any of the above stocks. Shares of Royal Caribbean sunk to a one-month low Tuesday morning, dropping more than 5% on the day following a string of troubling incidents, a setback for the world's biggest cruise line as it looks...
Lindblad Expeditions (LIND -1.77%) isn't your typical cruise company, and that could make it a safer play than most cruise line stocks. While others carry thousands of passengers per ship, Lindblad specializes in smaller, more expensive adventure cruises. The maximum capacity for these cruises is typically between 48 and 148 passengers, depending on the trip. These vacation travel companies have survived the most difficult period. That being said, cruise line stocks are still a long-term play that could have some rough seas ahead. Even when cruise lines have built some momentum, news of potential travel restrictions caused by the delta and omicron variants have sent their stock prices tumbling.
Companies Mentioned in This Article
Growth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time. A company's earnings performance is important for value investors as well. For fiscal 2024, five analysts revised their earnings estimate higher in the last 60 days for NCLH, while the Zacks Consensus Estimate has increased $0.11 to $1.26 per share. We selected firms that operate in the cruise industry, picking stocks based on future growth potential, underlying business fundamentals, optimistic analyst coverage, and strong hedge fund sentiment.
NYSE: CCL
Below, we look at the top three cruise line stocks with the best value, fastest growth, and best performance. Norwegian Cruise Line CEO Harry Sommer expressed that 2023 was a landmark year for the company. Consumer demand surged back to return to full ships and dull-year profitability.
In terms of the trailing-12-month EBITDA margin, RCL’s 31.29% is 183.3% higher than the 11.04% industry average. Its 44.70% trailing-12-month Return on Common Equity is 297.8% higher than the 11.24% industry average. On the other hand, the stock’s 0.40x trailing-12-month asset turnover ratio is 59.7% lower than the 1x industry average. In terms of the trailing-12-month asset turnover ratio, NCLH’s 0.45x is 55.1% lower than the 1x industry average. Its 36.04% trailing-12-month gross profit margin is marginally lower than the 36.18% industry average. Likewise, the stock’s 1.94% trailing-12-month net income margin is 58.2% lower than the 4.65% industry average.
Three Stock Lunch: Royal Caribbean, Rivian and Etsy
I warned you that cruise line stocks had some ugly year-to-date performances. However, sales growth can also prove to be potentially misleading about the strength of a business—growing sales does not guarantee a company will eventually become profitable. According to 17 analysts, the average rating for RCL stock is "Strong Buy." The 12-month stock price forecast is $137.44, which is an increase of 6.37% from the latest price. This cruise line is still known for its reasonable prices and ability to offer a fun time for everyone.
I still rank the three stocks as Royal Caribbean first, Carnival second, and Norwegian Cruise Line third, but all three will outperform the overall market if the cruise industry recovers in the year ahead. Below, we look at the top cruise line stocks for 2023 based on best value, fastest growth, and best performance. The Russell 1000 benchmark figure above is as of May 29, while all other data throughout are as of May 23. This year's ‘wave season' will break revenue records for cruise lines, but investors are wary of the massive debts the industry took on during the pandemic. Nevertheless, cruise lines tend to have a passionate customer base with plenty of repeat passengers. Over the long term, cruise line stocks may be a good value investment provided you are comfortable with some volatility.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities. NCLH sits at a Zacks Rank #3 (Hold), holds a Value Style Score of A, and has a VGM Score of A. Compared to the Leisure and Recreation Services industry's P/E of 16X, shares of Norwegian Cruise Line are trading at a forward P/E of 14.4X.
While many travel companies were affected by the pandemic, cruise lines were some of the most severely hurt. Cruise ships were docked for more than a year, causing their owners to miss out on billions of dollars in earnings. The biggest cruise companies own several cruise lines, with each of the major cruise companies taking a unique approach to keeping its customers loyal. If you want to invest in cruise line stocks, you have several attractive options.
The company also introduced 3 new ships in 2023, 1 for each brand. 2024 is poised to be exceptional for cruise vacations, with unprecedented booking volumes across different income levels, surpassing pre-COVID-19 levels. Cruise operators and travel agents report heightened interest due to the relative affordability of cruises compared to land-based alternatives. Despite cancellations in other travel sectors, cruise bookings for 2024 are anticipated to break records. With occupancy levels steadily approaching pre-pandemic levels, cruise operators are contemplating adjustments in pricing strategies to capitalize on the skyrocketing demand.
A simple, equally-weighted average return of all Zacks Rank stocks is calculated to determine the monthly return. The monthly returns are then compounded to arrive at the annual return. Only Zacks Rank stocks included in Zacks hypothetical portfolios at the beginning of each month are included in the return calculations. Zacks Ranks stocks can, and often do, change throughout the month. Certain Zacks Rank stocks for which no month-end price was available, pricing information was not collected, or for certain other reasons have been excluded from these return calculations. Zacks may license the Zacks Mutual Fund rating provided herein to third parties, including but not limited to the issuer.
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