Morningstar

Royal Caribbean Group RCL

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Stock XNYS Rating as of
$174.96 +1.73 (1.00%)
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As of Delayed Price Closed

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Robust Cruise Demand Lifts Royal Caribbean's Profit Trajectory as It Eclipses Trifecta Plan Goals

Jaime M Katz

Consumer interest in travel has maintained momentum for Royal Caribbean into 2024, continuing the robust demand and pricing trends in the business. The redeployment of the fleet was completed in mid-2022 and occupancy has returned to historical levels aiding a normalization of profits and cash flow. Royal Caribbean reported record pricing in 2023 (13% above 2019's level), with further growth anticipated in 2024, given robust advance booking patterns and price levels thanks to a healthy consumer appetite for travel. On the cost side, expenses should be better managed ahead as a result of optimized occupancy and ongoing productivity initiatives, aiding profitability.

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Price vs Fair Value

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RCL is trading within a range we consider fairly valued.
Price
$174.96
Fair Value
$481.00
Uncertainty
High
1-Star Price
$713.20
5-Star Price
$52.90
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

If consumer preference for experiences over things persists, yields could rise faster than we currently expect as demand rises.

Bears

Weakness in consumer spending spurred by an economic downturn could affect discretionary spending and cause pricing to soften intermittently.

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News

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Trading Information

Previous Close Price
$173.23
Day Range
$170.24–175.12
52-Week Range
$78.35–184.41
Bid/Ask
$173.50 / $175.25
Market Cap
$45.04 Bil
Volume/Avg
1.1 Mil / 2.3 Mil

Key Statistics

Price/Earnings (Normalized)
17.36
Price/Sales
3.36
Dividend Yield (Trailing)
0.23%
Dividend Yield (Forward)
0.91%
Total Yield
0.23%

Company Profile

Royal Caribbean is the world's second-largest cruise company, operating 68 ships across five global and partner brands in the cruise vacation industry. Brands the company operates include Royal Caribbean International, Celebrity Cruises, and Silversea. The company also has a 50% investment in a joint venture that operates TUI Cruises and Hapag-Lloyd Cruises. The selection of brands in the portfolio allows Royal to compete on the basis of innovation, quality of ships and service, variety of itineraries, choice of destinations, and price. The company completed the divestiture of its Azamara brand in 2021.
Sector
Consumer Cyclical
Industry
Travel Services
Stock Style Box
Mid Growth
Total Number of Employees
98,200
Website
https://www.royalcaribbeangroup.com

Competitors

Valuation

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Metric
RCL
NCLH
WH
Price/Earnings (Normalized)
 17.3617.4219.02
Price/Book Value
 7.5012.6010.00
Price/Sales
 3.360.984.64
Price/Cash Flow
 12.015.9822.60
Price/Earnings
RCL
NCLH
WH

Financial Strength

Metric
RCL
NCLH
WH
Quick Ratio
 0.080.120.72
Current Ratio
 0.190.240.90
Interest Coverage
 2.771.553.79
Quick Ratio
RCL
NCLH
WH

Profitability

Metric
RCL
NCLH
WH
Return on Assets (Normalized)
 7.96%2.97%8.21%
Return on Equity (Normalized)
 58.20%159.46%44.35%
Return on Invested Capital (Normalized)
 13.67%9.45%14.13%
Return on Assets
RCL
NCLH
WH

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