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Royal Caribbean (RCL) Laps the Stock Market: Here's Why

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Royal Caribbean (RCL - Free Report) closed the most recent trading day at $127, moving +1.37% from the previous trading session. This move outpaced the S&P 500's daily gain of 1.23%. On the other hand, the Dow registered a gain of 1.06%, and the technology-centric Nasdaq increased by 1.7%.

The the stock of cruise operator has fallen by 1.45% in the past month, leading the Consumer Discretionary sector's loss of 2.56% and undershooting the S&P 500's gain of 0.94%.

Investors will be eagerly watching for the performance of Royal Caribbean in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on February 1, 2024. In that report, analysts expect Royal Caribbean to post earnings of $1.11 per share. This would mark year-over-year growth of 199.11%. Meanwhile, our latest consensus estimate is calling for revenue of $3.37 billion, up 29.58% from the prior-year quarter.

Investors should also take note of any recent adjustments to analyst estimates for Royal Caribbean. These revisions help to show the ever-changing nature of near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Royal Caribbean is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, Royal Caribbean currently has a Forward P/E ratio of 13.76. This signifies a discount in comparison to the average Forward P/E of 16.59 for its industry.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 177, which puts it in the bottom 30% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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