Back to top

Image: Bigstock

Royal Caribbean (RCL) Dips More Than Broader Market: What You Should Know

Read MoreHide Full Article

In the latest trading session, Royal Caribbean (RCL - Free Report) closed at $327.03, marking a -1.08% move from the previous day. This move lagged the S&P 500's daily loss of 0.29%. At the same time, the Dow lost 0.37%, and the tech-heavy Nasdaq lost 0.34%.

Heading into today, shares of the cruise operator had lost 6.54% over the past month, lagging the Consumer Discretionary sector's loss of 0.43% and the S&P 500's gain of 3.08%.

The investment community will be closely monitoring the performance of Royal Caribbean in its forthcoming earnings report. On that day, Royal Caribbean is projected to report earnings of $5.65 per share, which would represent year-over-year growth of 8.65%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.16 billion, up 5.64% from the year-ago period.

RCL's full-year Zacks Consensus Estimates are calling for earnings of $15.63 per share and revenue of $17.98 billion. These results would represent year-over-year changes of +32.46% and +9.05%, respectively.

Investors should also take note of any recent adjustments to analyst estimates for Royal Caribbean. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.07% increase. Royal Caribbean is currently sporting a Zacks Rank of #3 (Hold).

In the context of valuation, Royal Caribbean is at present trading with a Forward P/E ratio of 21.15. This valuation marks a discount compared to its industry average Forward P/E of 21.26.

One should further note that RCL currently holds a PEG ratio of 0.93. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Leisure and Recreation Services industry currently had an average PEG ratio of 1.27 as of yesterday's close.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry, currently bearing a Zacks Industry Rank of 98, finds itself in the top 40% echelons of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Royal Caribbean Cruises Ltd. (RCL) - free report >>

Published in