A low price relative to intrinsic value can indeed suggest an investment opportunity, but only if the company’s fundamentals are sound or improving. In Royal Caribbean Group’s case, the declining revenues, EBITDA, and earnings growth suggest that the company’s issues may be more than just cyclical fluctuations. The company beat consensus EPS estimates in each of the trailing four quarters.

That’s because we believe the present value of its future stream of earnings is what determines the fair value for its stock. Royal Caribbean (RCL Quick QuoteRCL – Free Report) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.

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The Zacks Industry Rank assigns a rating to each of the 265 X (Expanded) Industries based on their average Zacks Rank. Plus, RCL info will be updated daily in your Zacks.com Portfolio Tracker – also free.

Royal Caribbean is expected to post earnings of $3.36 per share for the current quarter, representing a year-over-year change of +1,192.3%. Over the last 30 days, the Zacks Consensus Estimate has changed -0.5%. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. Here at Zacks, we prioritize appraising the change in the projection of a company’s future earnings over anything else.

Earnings and Valuation

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14 Wall Street research analysts have issued “buy,” “hold,” and “sell” ratings for Royal Caribbean Cruises in the last twelve months. There are currently 4 hold ratings and 10 buy ratings for the stock. The consensus among Wall Street research analysts is that investors should “moderate buy” RCL shares. High-growth stocks tend to represent the technology, healthcare, and communications sectors.

The near-term headwinds are significant, but investors should focus on the long-term picture — and vacationers should see how the industry is evolving. The cruise line keeps building more impressive ships and adding to its fleet. Here’s what today’s investors need to know to navigate the deep waters of this relatively small and cyclical industry. The cruise stock is one of the best-performing stocks of 2023.

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At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.32% per year.

• These distinctive investor brands aim to fulfill the unique needs of a growing base of client-partners.
• 14 Wall Street research analysts have issued “buy,” “hold,” and “sell” ratings for Royal Caribbean Cruises in the last twelve months.
• Dividend yield allows investors, particularly those interested in dividend-paying stocks,
  to compare the relationship between a stock’s price and how it rewards stockholders through dividends.
• Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns.

The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #1 (Strong Buy) for Royal Caribbean. Royal Caribbean is the world’s second-largest cruise company, operating 64 ships across five global and partner brands in the cruise vacation industry, with 10 more ships on order through 2026. Brands the company operates include Royal Caribbean International, Celebrity Cruises, and Silversea. The company completed the divestiture of its Azamara brand in the first quarter of 2021. Royal Caribbean Cruises updated its third quarter 2023 earnings guidance on Thursday, July, 27th. The company provided EPS guidance of $3.38-$3.48 for the period, compared to the consensus earnings per share estimate of $2.88.

Stock Money Flow

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RCL’s historical performance
against its industry peers and the overall market. Morningstar analysts hand-select direct competitors or comparable companies to
provide context on the strength and durability of RCL’s
competitive advantage. Without a clear turnaround strategy, there’s a risk that the company’s performance could continue to deteriorate, leading to further price declines.

In such a scenario, the low price-to-GF-Value ratio may be more indicative of a value trap than a value opportunity. Data are provided ‘as is’ for informational purposes only and are not intended for trading purposes. Data may be intentionally delayed pursuant to supplier requirements.

Since then, RCL stock has increased by 96.9% and is now trading at $97.35. RCL’s beta can be found in Trading Information at the top of this page. A stock’s beta measures how closely tied its price movements have been to the performance of the overall market. As an investor, you want to buy stocks with the highest probability of success. That means you want to buy stocks with a Zacks Rank #1 or #2, Strong Buy or Buy, which also has a Score of an A or a B in your personal trading style. The Style Scores are a complementary set of indicators to use alongside the Zacks Rank.

Royal Caribbean Cruises Ltd. share prices have moved between a 52-week high of $112.95 and a 52-week low of $36.92. The market has been high on Royal Caribbean Cruises Ltd (RCL) stock recently. RCL gets a Bullish score from InvestorsObserver Stock Sentiment Indicator. Supported by world-class markets data from Dow Jones and FactSet, and partnering with Automated Insights, MarketWatch Automation brings you the latest, most pertinent content at record speed and with unparalleled accuracy. The company is scheduled to release its next quarterly earnings announcement on Thursday, November 2nd 2023. Royal Caribbean Cruises’ stock was trading at $49.43 on January 1st, 2023.

So far today, approximately 487.81k shares of Royal Caribbean Cruises Ltd. have been exchanged, as compared to an average 30-day volume of 2.41M shares. © 2023 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided ‘as-is’ and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart’s disclaimer.

• And when a stock’s fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward.
• Style is calculated by combining value and growth scores, which are first individually calculated.
• A stock’s beta measures how closely tied its price movements have been to the performance of the overall market.

Dow Jones Industrial Average, S&P 500, Nasdaq, and Morningstar Index (Market Barometer) quotes are real-time. This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply. The industry with the best average Zacks Rank would be considered the top industry (1 out of 265), which would place it in the top 1% of Zacks Ranked Industries. The industry with the worst average Zacks Rank (265 out of 265) would place in the bottom 1%. An industry with a larger percentage of Zacks Rank #1’s and #2’s will have a better average Zacks Rank than one with a larger percentage of Zacks Rank #4’s and #5’s.

When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock’s fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate in bayes theorem unconditional probability is called as evidence revisions and short-term stock price movements. Royal Caribbean Cruises Ltd. operates as a cruise company worldwide. The company operates cruises under the Royal Caribbean International, Celebrity Cruises, Azamara, and Silversea Cruises brands, which comprise a range of itineraries that call on approximately 1,000 destinations.

There’s also a VGM Score (‘V’ for Value, ‘G’ for Growth and ‘M’ for Momentum), which combines the weighted average of the individual style scores into one score. MarketRank is calculated as an average of available category scores, with extra weight given to analysis and valuation. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. If the stock price is significantly above the GF Value Line, it is overvalued and its future return is likely to be poor. On the other hand, if it is significantly below the GF Value Line, its future return will likely be higher.

Price and EPS Surprise Chart

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. Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account.

One share of RCL stock can currently be purchased for approximately $97.35. Royal Caribbean Cruises’ stock is owned by a variety of retail and institutional investors. Insiders that own company stock include Arne Alexander Wilhelmsen, Henry L Pujol, Jason T Liberty, Lisa Lutoff-Perlo, Maritza Gomez Montiel, Michael W Bayley and Naftali Holtz. 545 employees have rated Royal Caribbean Cruises Chief Executive Officer Richard D. Fain on Glassdoor.com. Richard D. Fain has an approval rating of 95% among the company’s employees. This puts Richard D. Fain in the top 30% of approval ratings compared to other CEOs of publicly-traded companies.

Recent stocks from this report have soared up to +178.7% in 3 months – this month’s picks could be even better. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns. IBN consists of financial brands introduced to the investment public over the course of 17+ years. With IBN, we have amassed a collective audience of millions of social media followers. These distinctive investor brands aim to fulfill the unique needs of a growing base of client-partners. IBN will continue to expand our branded network of highly influential properties, leveraging the knowledge and energy of specialized teams of experts to serve our increasingly diversified list of clients.

The company topped consensus revenue estimates two times over this period. In the case of Royal Caribbean, the consensus sales estimate of $3.99 billion for the current quarter points to a year-over-year change of +33.3%. The $13.66 billion and $15.4 billion estimates for the current and next fiscal years indicate changes of +54.5% and +12.7%, respectively. Style is an investment factor that has a meaningful impact on investment risk and returns. Style is calculated by combining value and growth scores, which are first individually calculated.