Stifel raises Royal Caribbean price target to $275

Tuesday, Stifel analysts increased their price target on Royal Caribbean Cruises (NYSE:RCL) stock to $275 from the previous $265, while reiterating a Buy rating. The firm’s decision comes amid a positive outlook on the company’s performance and management, despite a challenging economic environment. According to InvestingPro data, the company’s stock has delivered an impressive 52% return over the past year, with analyst targets ranging from $185 to $330.

Stifel’s analysis highlights Royal Caribbean’s unique position in the market, as the company continues to provide guidance and reports strong booking and demand patterns through April. The cruise operator also indicated that its demand for 2026 aligns with historical averages, a sign of stability and confidence in future performance. This optimism is reflected in the company’s robust 18.6% revenue growth and analysts’ projected earnings of $15.27 per share for FY2025.

The analysts expressed surprise at Royal Caribbean’s decision not to adopt a more conservative stance for their second half of 2025 guidance. They praised the management team’s performance, suggesting that the recent quarter’s results demonstrated why the team should be highly regarded. InvestingPro analysis supports this view, with the company receiving a "GREAT" Financial Health Score and showing five recent analyst earnings upgrades for the upcoming period.

In the context of the current uncertain macroeconomic backdrop, Stifel’s analysts believe that Royal Caribbean’s stock remains attractive. They suggest that the recent dip in the company’s stock price presents a buying opportunity for investors looking to acquire quality names with long-term value. For deeper insights into RCL’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which includes detailed analysis of the company’s financial health and market position.

The firm’s confidence in Royal Caribbean is rooted in the belief that aligning with strong management teams is a prudent strategy, especially when facing economic uncertainty. Stifel’s endorsement of the cruise line’s shares reflects optimism about the company’s ability to navigate through potential challenges and maintain its growth trajectory.

In other recent news, Royal Caribbean Cruises reported strong first-quarter earnings for 2025, with an adjusted earnings per share (EPS) of $2.71, surpassing analysts’ forecast of $2.54. The company’s revenue, however, came in slightly below expectations at $4 billion, compared to the forecasted $4.01 billion. Despite the earnings beat, the stock experienced a decline, reflecting broader market concerns. Looking ahead, Royal Caribbean projects a full-year adjusted EPS growth of 28%, indicating a range of $14.55 to $15.55 for 2025. The company plans to expand its exclusive destinations and continue investing in fleet modernization, anticipating a yield growth of 2.6% to 4.6% and a 15% increase in adjusted EBITDA.

In another development, William Blair analysts maintained an Outperform rating on Royal Caribbean shares, emphasizing the success of the company’s loyalty program. The program has been instrumental in boosting guest frequency and spending, with loyalty members accounting for almost 40% of bookings last year. These members, on average, spend 25% more per voyage compared to non-members. The loyalty program also encourages more direct bookings, potentially enhancing margins by reducing reliance on third-party platforms. Enhanced digital capabilities and data-driven personalization have further contributed to Royal Caribbean’s ability to rebook guests, leading to increased customer satisfaction and loyalty.

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