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Miami-based Royal Caribbean Cruises Ltd. (RCL) operates as a global cruise vacation company. With a market cap of $57.1 billion, the company operates cruise brands like Royal Caribbean International, Celebrity Cruises, Azamara and Silversea Cruises and holds interest in TUI Cruises, Pullmantur and SkySea Cruises.
Companies worth $10 billion or more are generally described as “large-cap stocks,” Royal Caribbean fits right into that category, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the cruise industry.
Despite its notable strengths, RCL stock has plunged 20.8% from its all-time high of $277.08 touched on Jan. 31. Meanwhile, RCL has declined 9.4% over the past three months, slightly underperforming the Invesco Dynamic Leisure and Entertainment ETF’s (PEJ) 8.4% drop during the same time frame.
However, RCL’s performance looks much more impressive over the longer term. RCL has soared 30.3% over the past six months and 70.2% over the past 52 weeks, significantly outperforming PEJ’s 4.9% gains over the past six months and 10.1% returns over the past year.
To confirm the overall bullish trend and recent downturn, RCL has traded consistently above its 200-day moving average over the past year and fell below its 50-day moving average in late February.
Royal Caribbean Cruises’ stock prices soared 12% after the release of its impressive Q4 results on Jan. 28. Driven by the solid demand across its brands, the company’s total revenues for the quarter surged 12.9% year-over-year to $3.8 billion. Furthermore, the company observed a significant growth in profitability, its adjusted net income surged 34.4% year-over-year to $445 million and its adjusted EPS of $1.63 surpassed the Street’s expectations by 8.7%. Meanwhile, observing the solid business momentum, RCL gave a strong EPS guidance range of $2.43 to $2.53 for Q1, which boosted investor confidence.
Royal Caribbean has also outperformed its peer Carnival Corporation & plc’s (CCL) 15.9% gains over the past six months and 28.5% returns over the past year.
Among the 21 analysts covering the RCL stock, the consensus rating is a “Strong Buy.” Its mean price target of $283.14 indicates a 29% upside potential from current price levels.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
