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Royal Caribbean (RCL) Rises But Trails Market: What Investors Should Know

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Royal Caribbean (RCL - Free Report) closed at $124.12 in the latest trading session, marking a +1.2% move from the prior day. The stock lagged the S&P 500's daily gain of 1.41%. At the same time, the Dow added 0.58%, and the tech-heavy Nasdaq gained 2.2%.

The cruise operator's shares have seen an increase of 1.81% over the last month, not keeping up with the Consumer Discretionary sector's gain of 3.64% and the S&P 500's gain of 2.9%.

The upcoming earnings release of Royal Caribbean will be of great interest to investors. 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 might also notice recent changes to analyst estimates for Royal Caribbean. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, there's been a 0.57% rise in the Zacks Consensus EPS estimate. Royal Caribbean is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Royal Caribbean has a Forward P/E ratio of 13.47 right now. This denotes a discount relative to the industry's average Forward P/E of 16.64.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 97, which puts it in the top 39% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


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