Royal Caribbean Cruises Ltd
The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.
Goldman Sachs On Royal Caribbean Cruises
Analyst Lizzie Dove maintained a Buy rating while raising the price target from $220 to $245.
Royal Caribbean Cruises' net yields came in below investor expectations and the implied decline in the fourth quarter was an initial disappointment, Dove said in a note.
She added that the fourth-quarter net yield guidance of 5.3%-5.8% includes a headwind of around 40 basis points (bps) from Hurricane Milton and "several bps headwind from the canceled Icon itinerary."
The focus during the company's earnings release was on 2025 and beyond, "as investors looked through the 4Q guidance which came in a touch light, and 3Q results which were also a little lower than investor expectations," the analyst stated.
Management guided to 2025 adjusted earnings of $14 per share, which was "just a starting point and "does not factor in several drivers of upside including, notably, buybacks," she added.
Truist Securities On Royal Caribbean Cruises
Analyst Patrick Scholes reiterated a Hold rating and price target of $204.
Royal Caribbean Cruises delivered "a sizable earnings beat," but this was expected, given the company's track record over the past year, Scholes said. The earnings upside was driven by costs, rather than revenues and the growth rate of commission expense was again significantly below growth in passenger ticket revenue, he added.
Although the company outperformed its third-quarter earnings guidance by 25 cents per share, it raised the full-year guidance by only 19.5 cents per share, the analyst stated. The fourth-quarter earnings guidance of $1.40-$1.45 per share missed consensus expectations of $1.58 and came in slightly below the previous implied guide of $1.47 per share, he further mentioned.
RCL Price Action: Shares of Royal Caribbean Cruises had declined by 0.13% to $209.83 at the time of publication on Wednesday.
