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With a market valuation of $66 billion, Royal Caribbean Cruises Ltd. (RCL) is a cruise line that offers a variety of itineraries under the Royal Caribbean International, Celebrity Cruises, and Silversea Cruises brands. The Miami, Florida-based company primarily serves the contemporary, premium, and deluxe segments of the cruise vacation industry, which also includes the budget and luxury segments.
Companies worth $10 billion or more are generally described as “large-cap” stocks, and RCL fits right into that category with its market cap exceeding this threshold. The cruise holding company offers itineraries covering more than 270 destinations across over 60 countries and is renowned for its onboard thrills, dining options, entertainment, and world-class accommodations.
RCL is currently trading 5.6% below its 52-week high of $258.70, reached on Dec. 9. Shares of this travel services company rallied 47.5% over the past three months, significantly outpacing the broader Consumer Discretionary Select Sector SPDR Fund’s (XLY) 22.7% returns during the same time frame.
Moreover, in the longer term, RCL has soared almost 103% over the past 52 weeks, significantly surpassing XLY’s 34.7% returns. Shares of RCL are up 88.6% on a YTD basis, massively outperforming XLY’s 31.2% gains over the same time frame.
To confirm its bullish trend, RCL has been trading above its 200-day moving average since the past year and has remained above its 50-day moving average since mid-September
On Oct. 29, shares of RCL jumped 3.2% following its strong Q3 earnings release. The company’s revenue of $4.89 billion increased 17.3% from a year ago and came in line with the consensus estimates. Its adjusted EPS climbed by a massive 35% year-over-year to $5.20 and exceeded the forecasted figure by 3.3%.
RCL benefited from stronger pricing on close-in demand, robust growth in onboard revenue, and lower costs. Moreover, encouraged by the solid performance in Q3, the company raised its full-year 2024 EPS guidance, which might have further enhanced investor confidence.
RCL’s outperformance becomes even more evident when compared to its rival, Carnival Corporation & plc (CCL), which gained 46.9% over the past 52 weeks and 41.2% on a YTD basis.
Looking at RCL’s recent outperformance, analysts remain strongly optimistic about its prospects. The stock has a consensus rating of “Strong Buy” from the 20 analysts covering it, and the mean price target of $247.05 suggests a slight 1.2% premium to its current levels.
