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On Wednesday, UBS analysts maintained a positive outlook on Royal Caribbean Cruises (NYSE:RCL) shares, reiterating a Buy rating and a price target of $301.00. The firm’s analysis suggests that the company’s financial guidance surpassed market expectations, a sentiment not usually reflected in the cruise line industry until actual results are delivered. InvestingPro data shows that 8 analysts have recently revised their earnings estimates upward, with analyst targets ranging from $185 to $330.
Royal Caribbean has increased its full-year net yield guidance following a stronger-than-anticipated first-quarter performance. The company also slightly improved its net cruise cost guide. Additionally, Royal Caribbean anticipates a $0.55 increase in earnings per share (EPS) at the midpoint, attributing this to reduced fuel expenses and favorable foreign exchange rates. This adjustment could lead to a year-over-year growth of 28% at the midpoint. The company’s strong performance is reflected in its impressive gross profit margin of 49.6% and revenue growth of 13.7% over the last twelve months. For deeper insights into RCL’s financial health and growth prospects, check out the comprehensive Pro Research Report available on InvestingPro.
Despite the positive trends observed in the first quarter, Royal Caribbean has chosen to adopt a conservative stance for its second-half forecasts. The EPS guidance range has been expanded to one dollar wide, in contrast to the previous 30 cents range. However, the guidance ranges for yield and net cruise cost ( NCC (NSE:NCCL)) remain unchanged.
Royal Caribbean also provided guidance for the second quarter, indicating that earnings are expected to surpass estimates by $0.05 to $0.10. This update underscores the company’s confidence in its performance and its ability to exceed market expectations.
In other recent news, Royal Caribbean Cruises reported a strong first quarter for 2025, with an adjusted earnings per share (EPS) of $2.71, surpassing the forecasted $2.54. The company’s revenue, however, came in slightly below expectations at $4 billion compared to the projected $4.01 billion. Despite the earnings beat, Royal Caribbean’s stock experienced a decline, reflecting broader market concerns. The company anticipates a full-year adjusted EPS growth of 28%, with projections between $14.55 and $15.55 for 2025. Stifel analysts raised their price target for Royal Caribbean to $275, maintaining a Buy rating, citing the company’s strong market position and management performance. William Blair analysts reiterated an Outperform rating, highlighting the success of Royal Caribbean’s loyalty program, which has driven increased customer spending and engagement. These developments underscore the company’s strategic initiatives and continued focus on enhancing customer experiences and financial stability.
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