Two National Guard members shot near White House
Investing.com -- According to Bernstein analysts, cruise pricing softened in November, and the firm warned that its latest tracker shows a clear setback after signs of stabilization in October.
Analyst Richard Clarke said “the headline message from our November tracker is negative,” noting that Royal Caribbean group-wide prices were “down 5% YoY, with LfL pricing down 7.7%.”
Bernstein said the weakness was “primarily felt in the Caribbean, Mexico and the Bahamas,” which it linked to “the prevailing narrative of over-supply.”
Clarke added that November marked “a step back from the 3.3% we saw in October,” indicating “some incremental weakness.”
The analyst stated that LfL pricing in November was “down 7.7%, with the RCL brand down 10% and Celebrity more resilient at -2%.”
Including mix effects, Bernstein said “overall yields were down 5%.”
The analyst cautioned that Black Friday timing may have distorted the data slightly, stating that prices are often “raised then lowered into the sale period,” and that this year’s scrape occurred “one day closer to Black Friday,” which “may have a negative impact on the conclusions.”
Still, Bernstein said the analysis “does show some signs of pricing weakness, particularly in the North American markets subject to heightened supply.”
Despite the softer November trends, Bernstein believes the weakness “looked reasonably well anticipated in company guidance.”
Furthermore, the firm remarked that ticket prices for Q4 sailings are “up 2.2%,” supporting guidance for “2.4-2.7% Net Yield growth.” Q1 pricing is “fairly stable to Q4 (+2.4%),” with a tailwind expected from the Royal Beach Club, and early Q2 data shows ticket prices “up 6%.”
Bernstein concluded it does “not expect this should lead to further disappointment,” calling the weakness “temporary and well guided to.”