best cruise lines stock

7 Best Cruise Stocks to Buy Now

Many cruise stocks have yet to bounce back to their pre-pandemic prices, but the industry is seeing positive demand and revenue growth.

Cruise Stocks to Buy Now

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Cruise stocks can continue their run as long as travel demand stays strong.

After a gloomy performance during the pandemic, many cruise stocks have delivered gains for long-term investors. The cruise industry is poised to benefit from a multiyear boom, however, as Grand View Research projects that it will maintain a compound annual growth rate of 11.5% from now until 2030.

While growth was easy to find as the industry recovered from the pandemic, some cruise stocks have posted double-digit returns year to date. Many of these same companies have rising revenue and profit margins. But despite positive sentiment, many cruise stocks still have not returned to their pre-pandemic prices.

Cruise Stock Risks to Keep in Mind

With the pandemic largely in the rear-view mirror, the travel sector carries some risks. Some stocks are riskier than others, but John Engle, president of Almington Capital, says some risks specifically apply to cruise stocks.

"The biggest risk for cruise stocks is sustainable profitability," says Engle. "Many cruise operators are carrying an awful lot of debt, and it is not clear whether they will be able to service it over the long run. Thin profit margins and high debt should always be a cause for concern for investors looking at cyclical industries. Even a mild recession could be enough to devastate cruise operators' bottom lines."

An economic slowdown may be on the way. The latest U.S. jobs report, released earlier this month, revealed lower job growth than expected in July and a rising unemployment rate. Furthermore, some of the job growth numbers in previous months have been revised downward, meaning they were lower than the U.S. Labor Department initially reported.

Cruise stocks can continue their run as long as travel demand stays strong. However, any slowdowns can hurt cruise companies that carry significant debt. Cruise stock investors should carefully monitor travel demand to gauge the risk of their investments.

Investors seeking exposure to heightened travel demand may want to consider these seven top cruise stocks:

Carnival Corp. ( CCL )

Carnival's revenue and net income have continued to trend upward ever since the demand for travel returned. The company's second-quarter results revealed that sales increased by 17.7% year over year as total customer deposits reached a record $8.3 billion. That's more than $1.1 billion higher than the previous record.

Carnival also reported a record $560 million in operating income. That's nearly five times 2023 levels, and it accompanied a record $5.8 billion in second-quarter revenue.

The company raised its guidance for fiscal 2024, and its successes in 2024 should carry over into 2025, which can benefit long-term investors .

"We are very pleased with the continued acceleration of demand for 2025 and beyond, which builds upon the fantastic achievements in 2024 thus far," CEO Josh Weinstein said in Carnival's second-quarter earnings news release.

Royal Caribbean Cruises Ltd. ( RCL )

Royal Caribbean Cruises has returned to profitability with net profit margins above 20%. The cruise holding company raised full-year guidance after reporting solid results in the second quarter. Net income came in at $854 million compared to $459 million in the same quarter last year. That's an 86% year-over-year increase.

The total customer deposit balance reached $6.2 billion at the end of the second quarter. Furthermore, Royal Caribbean Cruises recently reinstated its dividend. Investors will receive a quarterly dividend of 40 cents per share. Heightened adjusted EPS guidance of $11.35 to $11.45 per share suggests a 68% year-over-year improvement.

Commentary from company President and CEO Jason Liberty suggests that business is booming.

"We have seen strength for all key products and are already taking more bookings for 2025 sailings than 2024," he states.

Norwegian Cruise Line Holdings Ltd. ( NCLH )

Norwegian Cruise Line Holdings is yet another cruise operator raising its guidance, projecting full-year adjusted EBITDA of $2.35 billion, up from $2.3 billion. Norwegian also raised its full-year adjusted net income guidance from $730 million to $790 million, marking a $60 million increase.

The cruise company reported second-quarter revenue of $2.4 billion, which was 8% higher than the same quarter last year. GAAP net income came in at $163.4 million, which was a 90% year-over-year improvement.

Norwegian is on pace to achieve a double-digit adjusted return on invested capital by the end of the year. Adjusted EPS is expected to grow by approximately 120% compared to 2023.

Mark A. Kempa, executive vice president and chief financial officer, mentioned that the company has strong momentum and sees "robust demand" as it enters the second half of 2024.

Lindblad Expeditions Holdings Inc. ( LIND )

Lindblad Expeditions is a smaller cruise stock with a $425 million market capitalization. The company reported 7% year-over-year sales growth in the first quarter. Demand continues to grow, as bookings for 2024 are 4% ahead of bookings for 2023. Available guest nights increased by 3% year over year, allowing Lindblad to accommodate more visitors.

The company's cash position increased from $187.3 million on Dec. 31 to $224.2 million as of March 31. That's a 19.7% increase. Lindblad is also in the middle of a stock buyback program. As of April 29, the company had used $23 million of the $35 million it authorized for share repurchases.

Agilysys Inc. ( AGYS )

Agilysys provides software for the hospitality industry, giving it some exposure to cruise lines. The company serves various sectors, such as hotels, resorts, stadiums and higher education.

Shares are off to a good start year to date, rising about 20% as of Aug. 5, and have more than quadrupled over the past five years.

The company delivered 13.3% year-over-year revenue growth in the first quarter of fiscal 2025. That marks its 10th consecutive record-revenue quarter. Subscription revenue, which now makes up more than half of total recurring revenue, increased by 32% year over year. As subscription revenue consists of a larger portion of the total business, Agilysys' revenue growth should accelerate. Net income attributable to shareholders soared from $1.1 million to $14.1 million year over year.

Agilysys anticipates generating $275 million to $280 million in revenue throughout fiscal 2025. Adjustable EBITDA is expected to be 16% of revenue.

OneSpaWorld Holdings Ltd. ( OSW )

OneSpaWorld Holdings provides spas, wellness and treatments on cruises and on land. Shares are up by 7.2% year to date and come with a dividend yield just above 1%. Revenue increased by 12% year over year in the second quarter, prompting the company to raise its fiscal year guidance.

The company operates health and wellness centers on 197 ships, compared to 183 ships in the same quarter last year. Net income reached $15.8 million, compared to a $3.2 million net loss in Q2 2023. OneSpaWorld Holdings anticipates 2024 revenue will range from $870 million to $890 million. The midpoint implies 10.8% year-over-year revenue growth compared to the $794 million generated in 2023.

"We remain confident in our ability to deliver strong operating and financial performance, both near term and long term, and increase value to our shareholders," CEO Leonard Fluxman said in OneSpaWorld's second-quarter earnings release.

World Kinect Corp. ( WKC )

World Kinect Corp., formerly known as World Fuel Services Corp., is an energy, commodities and services company. It has delivered over 18 billion gallons of fuel to more than 150,000 customers, including cruise lines. World Kinect's revenue was flat in the second quarter, but shares are up by 15% year to date. Diluted earnings per share soared by 277% year over year to reach $1.81.

Chairman and CEO Michael Kasbar noted that the company is facing short-term headwinds in its Land segment, but its Aviation business continues to soar. Gross profits for the aviation segment are up by 3% year over year and make up almost half of the the company's total gross profits. CFO Ira Birns said in the company's earnings release that World Kinect is focused on expense control and working capital management.

Should You Get On Board With Cruise Stocks?

Many cruise stocks have delivered rising revenue and profit margins and have raised their guidance for the rest of the year. Significant travel growth has helped cruise lines hit revenue records and achieve profitability.

However, cruise stocks have their risks. An economic slowdown can hamper their business model and make it more difficult to achieve double-digit year-over-year revenue growth.

Investors should also monitor how cruise lines cover their long-term debt and track whether the demand for travel remains elevated.

Tags: investing , stock market , Carnival Corp. , Norwegian Cruise Line , Royal Caribbean Cruises

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• The 8 Best Cruise...

The 8 Best Cruise Stocks To Buy Right Now!

• By Noah Zelvis
• Jul 08, 2024

The cruise industry has long been a staple of the travel and leisure market, offering unique vacation experiences on the open seas.

With a diverse array of options from luxury cruises to family-oriented trips, cruise lines have cultivated a dedicated customer base.

As the travel industry evolves, cruise stocks present intriguing opportunities for investors seeking to capitalize on this dynamic sector.

We’ve compiled a list of the best cruise stocks to buy now, highlighting companies that are well-positioned for long-term growth.

Best Cruise Stocks

Norwegian cruise line holdings (nyse: nclh).

Norwegian Cruise Line Holdings is a cruise line incorporated in Bermuda and headquartered in Miami. Founded in 1966, Norwegian Cruise Line is the third-largest cruise line in the world in terms of passenger numbers.

The company boasts a fleet of 28 ships that sail to nearly 500 destinations worldwide.

Norwegian Cruise Line is known for its innovative approach to cruising, offering a variety of amenities and experiences on its ships.

The company plans to add nine more ships to its fleet over the next five years, enhancing its capacity and destination offerings. Additionally, Norwegian owns two private islands in the Caribbean, providing exclusive experiences for its guests.

Norwegian Cruise Line’s commitment to safety and guest satisfaction positions it well for future growth.

The company’s strategic investments in fleet expansion and destination development could drive long-term success in the industry.

Royal Caribbean Group (NYSE: RCL)

Royal Caribbean Group, formerly known as Royal Caribbean Cruises Ltd., is the second-largest cruise line in the world.

The company operates four separate cruise lines: Royal Caribbean International, Celebrity Cruises, Azamara Cruises, and Silversea Cruises.

Incorporated in Liberia and headquartered in Miami, Florida, Royal Caribbean has a total of 24 ships in its fleet, with more on the way.

The company aims to provide luxurious cruise experiences, complete with high-tech entertainment and upscale amenities.

Royal Caribbean is considered a high-end brand, attracting a loyal customer base that appreciates its premium offerings.

Royal Caribbean’s strategic focus on luxury and innovation could drive future growth.

The company’s efforts to enhance guest experiences and expand its fleet position it well for long-term success in the travel industry.

Carnival Corporation & PLC (NYSE: CCL)

Carnival Corporation is the world’s largest travel leisure company, with a substantial presence in both the U.S. and U.K. markets.

Headquartered in Miami, Florida, Carnival operates a portfolio of 87 ships across ten cruise line brands.

Carnival’s extensive fleet and diverse brand portfolio make it a formidable player in the cruise market.

The company has a strong track record of delivering memorable vacation experiences to its passengers.

Carnival’s strategic focus on safety and guest satisfaction is evident in its operational practices and customer service initiatives.

Despite recent challenges in the travel industry, Carnival remains a resilient and innovative company.

Its ongoing investments in fleet expansion and destination development position it well for future growth.

As the largest player in the industry, Carnival could provide excellent long-term investment opportunities.

Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND)

Lindblad Expeditions Holdings, Inc., is a unique cruise line that has partnered with National Geographic to offer immersive vacation experiences.

The company’s fleet includes 15 ships that sail to over 27 locations, providing guests with opportunities to explore natural beauty up close.

Lindblad’s partnership with National Geographic allows it to offer unique expeditions that go beyond typical cruise experiences.

The company focuses on small ship expeditions, which provide a more intimate and personalized travel experience.

Lindblad’s commitment to sustainability and conservation aligns with its mission to offer responsible travel experiences.

The company’s innovative approach to expedition cruising and its focus on sustainability could drive long-term growth.

Lindblad’s ability to offer unique and memorable travel experiences positions it well in the niche market of expedition cruising.

The Walt Disney Company (NYSE: DIS)

The Walt Disney Company, known for its iconic media and entertainment ventures, also has a significant presence in the cruise market. Disney

Cruise Line offers family-oriented cruise experiences that cater to children and adults alike. Disney’s cruises are an extension of its broader entertainment portfolio, which includes theme parks, movies, and television.

Disney’s diverse entertainment offerings and strong brand recognition provide a solid foundation for its cruise line operations.

The company’s ability to innovate and adapt to market trends ensures its resilience and long-term growth potential.

Disney Cruise Line’s commitment to providing high-quality family experiences aligns with the company’s overall mission to create magical moments for its guests.

Disney’s strategic focus on expanding its cruise line operations and enhancing guest experiences positions it well for future growth.

The company’s extensive brand recognition and loyal customer base support its position as a top player in the cruise and entertainment industries.

Best Cruise Ship – Related Stocks to Buy

Onespa world holdings ltd. (nasdaq: osw).

OneSpaWorld Holdings Limited is a company that provides luxury health, beauty, fitness, and wellness services to cruise lines and other businesses in the hospitality industry.

The company’s operations include selling top-end wellness products and services to cruise lines such as Norwegian, Royal Caribbean, and Carnival.

OneSpaWorld’s focus on high-end spa and wellness services positions it well to capitalize on the growing demand for luxury travel experiences.

The company’s strategic partnerships with major cruise lines and hospitality brands support its growth potential. OneSpaWorld’s commitment to innovation and excellence in wellness services could drive long-term success.

As cruise ships continue to sail and the demand for luxury travel experiences grows, OneSpaWorld’s positive momentum should continue. The company’s focus on providing top-notch wellness services positions it well for future growth in the cruise and hospitality industries.

World Kinect Corporation (NYSE: WKC)

World Kinect Corporation is a global energy management company that provides fuel and energy solutions to various industries, including marine, aviation, and land segments.

The company offers services such as fuel supply, logistics, and energy management, which are essential for the cruise sector.

World Kinect’s diversified approach ensures that it can meet the energy needs of different sectors, providing stability and growth opportunities.

The company’s extensive experience in energy management and its strategic focus on sustainable and efficient energy solutions position it well for long-term growth.

As the cruise market rebounds, World Kinect’s expertise in marine fuel services could see increased demand, supporting its growth prospects.

The company’s commitment to innovation and sustainability in energy management makes it a strong contender in the energy solutions market.

Cruise Ship Penny Stocks

Investing in penny stocks carries more risk, but with that comes growth potential.

Due to the low price of the stock, traders can accrue many shares.

While low-priced stocks are more likely to fail to meet standards of publicly traded companies, they are also more likely than high-priced stocks to experience exponential growth.

Sabre Corporation (NASDAQ: SABR)

Sabre Corporation is a global technology company that provides software and technology solutions to the travel and tourism industry.

Sabre’s offerings include reservation systems, travel management software, and other technological solutions that support the operations of airlines , hotels, and cruise lines.

The company’s technology enables efficient booking, management, and operation of travel services, which is crucial for the cruise sector.

Sabre’s commitment to innovation and its strategic partnerships with major travel providers position it well to benefit from the recovery in the travel and tourism sector.

As the demand for travel increases, Sabre’s advanced technology solutions could play a key role in supporting the growth of the cruise market.

The company’s focus on providing seamless and efficient travel experiences makes it a valuable partner for cruise lines and other travel-related businesses.

Should I Buy Cruise Line Stocks?

Investors looking to take on a little risk for significant returns should consider purchasing some cruise stocks. Here are some considerations to keep in mind:

Benefits of Investing in Cruise Line Stocks

High Potential Returns – As the travel sector recovers, cruise line stocks could see significant growth.

Diverse Offerings – Cruises offer various experiences, from luxury cruises to family-friendly trips, attracting a wide range of customers.

Global Reach – Many cruise lines operate internationally, providing exposure to different markets and potential for growth.

Factors to Consider

Market Volatility – The travel industry can be highly volatile, influenced by global events and economic conditions.

Health and Safety Regulations – Cruise lines must comply with strict health and safety regulations, which can impact operations and costs.

Economic Recovery – The pace of economic recovery will influence the return to normalcy for the travel industry.

Investing in cruise stocks could be a strategic move for those willing to accept the associated risks. It is essential to conduct thorough research and consider the unique factors influencing the industry.

Best Cruise Ship Stocks: Final Thoughts

Investing in cruise stocks provides an opportunity to capitalize on the potential recovery of the travel and tourism industry.

Many companies are still at a low after being shut down for so long, making now a great time to invest.

As things begin to return to normal, all signs point to cruise stocks seeing healthy increases.

With a diversified portfolio of cruise stocks, investors could potentially benefit from the industry’s rebound and long-term growth.

While there are inherent risks, the potential rewards of investing in established and innovative cruise companies make it a compelling option for long-term investors.

By staying informed and making strategic decisions, traders can navigate the market and maximize their returns in the cruise market.

FAQs About Cruise Stocks

What are the best cruise stocks to buy right now.

The best cruise stocks to buy now include Norwegian Cruise Line, Royal Caribbean Cruises, Carnival Corporation, and Lindblad Expeditions.

These companies are well-established in the industry and are poised for growth as the travel industry rebounds.

Why Should I Invest in Norwegian Cruise Line Stock?

Investing in Norwegian Cruise Line stocks offers potential upside due to the company’s innovative approach, diverse destinations, and plans to expand its fleet.

Norwegian Cruise Line is popular among solo travelers and younger generations, making it a strong competitor in the cruise industry.

How Have Cruise Stocks Rebounded Since the Pandemic?

Since the COVID-19 pandemic, cruise stocks have gradually rebounded as the travel industry recovers.

Companies have implemented enhanced safety measures and resumed operations, regaining popularity among travelers.

How Do Carnival Cruises Compare to the Competition?

Carnival Corporation, as the world’s largest travel leisure company, offers a diverse range of cruise experiences with its extensive fleet and multiple brands.

While it has the advantage of scale and a wide variety of options for travelers, some competitors may offer more luxurious amenities and innovative entertainment options.

What Is the Potential Upside of Investing in Cruise Stocks?

The potential upside of investing in cruise stocks includes capitalizing on the travel industry’s recovery, benefiting from increased passenger demand, and taking advantage of innovative offerings by leading cruise companies.

As operations return to normal, cruise stocks are poised for growth.

How Do Cruise Companies Ensure the Safety of Passengers While Operating?

Cruise companies ensure the safety of passengers by implementing strict health and safety protocols, such as enhanced cleaning measures, vaccination requirements, and regular health screenings.

Noah Zelvis is a writer with more than 18 years of experience under his belt. He started out by blogging his adventures overseas and quickly found success creating paid content thanks to his ability to convey his articles in a clear and concise manner. Equipped with an engineering background and an analytical mind, Noah has a passion for all things business and finance. His personal investment journey began at a young age, helping his grandma with her portfolio. That spark blossomed into a never-ending search for the best stocks Noah still carries today. He’s thoroughly researched the corporate financial world as well and has an innate understanding of the banking and credit sector. Other published works also include travel, running, video games, product reviews, and more. Now, Noah uses his expertise to share his financial and investment know-how here at Stock Dork. When not at his desk, you’ll likely catch Noah traveling or running.

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Best Value Cruise Line Stocks

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Top Cruise Line Stocks for 2023

CCL, NCLH, and RCL are top for value, growth, and performance, respectively

Peter Adams/Getty Images

Cruise line companies are seeing a strong rebound after years of COVID-related setbacks, with passenger booking rates up industry-wide. Still, just one stock—Royal Caribbean Group—has outperformed the broader market in the last year.

Royal Caribbean shares are up about 42% in the last year, while the benchmark Russell 1000 Index is up just over 1%. All other cruise industry stocks have lost value in the past year, a sign there could still be room for further recovery.

Below, we look at the top cruise line stocks for 2023 based on best value, fastest growth, and best performance. The Russell 1000 benchmark figure above is as of May 29, while all other data throughout are as of May 23.

These are the cruise line stocks with the lowest 12-month trailing price-to-sales (P/S) ratio . For companies in early stages of development or industries suffering from major shocks, this can be substituted as a rough measure of a business's value. A business with higher sales could eventually produce more profit when it achieves (or returns to) profitability. The price-to-sales ratio shows how much you're paying for the stock for each dollar of sales generated.

Source: YCharts

• Carnival Corp.:  Carnival operates the world’s largest fleet of cruise ships. The company also owns travel-related properties such as hotels and vacation destinations. Carnival shares have fallen 16% in the last year while revenues nearly tripled for the first quarter of the year as a result of surging demand post-pandemic.
• Norwegian Cruise Line Holdings Ltd.: Norwegian Cruise Line operates a fleet of passenger cruise ships. In addition, the company offers itineraries and theme cruises. Norwegian's revenue more than tripled for the first three months of the year as it ramped up cruise voyages again following COVID-19.
• Lindblad Expeditions Holdings Inc.: Lindblad Expeditions owns and operates cruise ships and provides expedition cruising and travel services. The company offers both sea-based and land-based expeditions. Lindblad shares have plunged by 22% in the last year, making it among the worst-performing cruise line stocks that we looked at.

These are the cruise line stocks with the highest  year-over-year (YOY)  sales growth for the most recent quarter. Rising sales can help investors to identify companies that are able to grow revenue organically or through other means and to find growing companies that have not yet reached profitability.

In addition, accounting factors that may not reflect the overall strength of the business can significantly influence  earnings per share (EPS) . However, sales growth can also prove to be potentially misleading about the strength of a business—growing sales does not guarantee a company will eventually become profitable.

• Norwegian Cruise Line Holdings Ltd.: See company description above.
• Carnival Corp.:  See company description above.
• Royal Caribbean Group: Royal Caribbean Group, formerly known as Royal Caribbean Cruises, operates either directly or through joint ventures a fleet of 64 ships with a total capacity of 150,000 berths. Total revenue almost tripled in the most recent quarter, driven by rebounds in both passenger ticket sales and onboard revenue.

These are the cruise line stocks that had the highest returns or smallest declines in total return over the past 12 months out of the companies we looked at.

• Royal Caribbean Group: See company description above.

Shareholder Perks: A little-known benefit of holding cruise line stocks is that they offer shareholder perks. For instance, investors who hold at least 100 Carnival shares are entitled to a $250 onboard credit for cruises that are 14 days or longer, a $100 credit for cruises between 7 and 13 days, and a $50 credit for sailings of six days or less. Similarly, both Royal Caribbean and Norwegian Cruise Line offer comparable shareholder benefits. To claim these benefits, investors need to provide proof of ownership, such as a shareholder proxy card or a copy of a current brokerage statement.

Pent-Up Demand: Cruise line companies have seen a rebound in demand as customers book cruises they had put on hold during COVID-19. This positions operators in the sector to boost profits as fleets are back at total capacity with reduced COVID requirements. In March 2023, for example, Carnival Cruise Lines said it had reached record future bookings.

High Debt Load: Cruise line companies racked up substantial debt over the past several years to stay afloat during the pandemic. With inflation leading to higher fuel costs and rising interest rates , these elevated debt levels will become increasingly difficult to service, increasing the risk of the companies offering new shares to raise capital , thus diluting the stakes of current shareholders.

Future Pandemics: Cruise Line stocks sank during the pandemic, with the sector facing multiple challenges from bad publicity, no-sail orders, and a sluggish recovery. In the early stages of the health crisis, reports of major outbreaks spreading onboard put downward pressure on the group. Selling accelerated as the Centers for Disease Control and Prevention (CDC) issued and extended no-sail orders. Although forward bookings have bounced back, these challenges remind investors that future pandemics remain a risk for cruise line stocks.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes online. Read our  warranty and liability disclaimer  for more info.

As of the date this article was written, the author does not own any of the above stocks.

The Maritime Executive. " Cruising’s Rebound Raises Hopes of Normalcy Going Forward ."

YCharts. " Financial Data ."

Carnival Corp. " CARNIVAL CORPORATION & PLC PROVIDES FIRST QUARTER 2023 BUSINESS UPDATE ."

Norwegian Cruise Line Holdings Ltd. " Norwegian Cruise Line Holdings Reports First Quarter 2023 Financial Results ."

Royal Caribbean Cruises Ltd. " Form 10-K for the fiscal year ended December 31, 2022 ." Page 2.

Royal Caribbean Group. " ROYAL CARIBBEAN GROUP REPORTS FIRST QUARTER EARNINGS AND INCREASES FULL YEAR GUIDANCE ON STRONG REVENUE OUTLOOK ."

Cruise Radio. " Overview: Cruise Line Stock Benefits for Shareholders ."

Fox Business. " Carnival Cruise Lines has record future bookings, demand rebounds ."

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Look at the Stocks Leading the Market Now

Devastated at the height of the pandemic, cruise lines have become top performers.

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By Jeff Sommer

Jeff Sommer is the author of Strategies , a weekly column on markets, finance and the economy.

Many top performers in the stock market for the first half of this year were exactly what you would expect, if you’ve been following the news.

Big tech companies were well represented at the front of the pack, led by Nvidia, which makes computer chips that power artificial intelligence programs. It was followed closely by Meta, the Facebook owner, which has been promoting its own A.I. prowess. Tesla, the electric vehicle champion, wasn’t far behind.

But what were cruise ships doing near the very pinnacle of the stock market listings?

At midyear, three of the big cruise companies — Carnival, Royal Caribbean Group and Norwegian Cruise Line Holdings — were among the top 10 stocks in the S&P 500.

Consider that only three years ago, in the first months of the coronavirus pandemic, all cruise lines suspended operations and that in the ensuing months, the shares of publicly traded cruise companies were devastated.

Now, with fears of contagion ebbing and pent-up demand for pleasure trips being unleashed, cruise lines have had a remarkable change of fortune.

Inconsistent Returns

Each of the cruise line stocks had astonishing gains for the first six months of the year, but they are still down significantly from the start of 2020.

Here are their returns, according to FactSet:

Carnival, up 134 percent for the first six months of 2023 but down 63 percent since the start of 2020.

Royal Caribbean Group, up 110 percent in the first half of 2023 but down 22 percent since 2020.

Norwegian Cruise Line, up 78 percent in the first half of 2023 but down 63 percent since 2020.

Returns like these might be puzzling if you were unaware of what happened on the planet in the last three years. But factor in the pandemic and the subsequent economic recovery, and the cruise line stock and bond performance tracks nicely.

It’s part of a larger pattern.

Just as cruise lines have begun to come into their own, a series of companies that prospered during the pandemic are laggards now. Peloton, Zoom and Etsy are trailing in this year’s stock market performance derby. And major pharmaceutical companies, like Moderna and Pfizer, whose shares took off when the firms were providing scarce and desperately needed vaccines against Covid-19, are among the poorest performers in the S&P 500.

The Pandemic

Briefly put, it wasn’t until December 2019 that the first reports of the emergence of a novel coronavirus began to emanate out of China — and in March 2020 that the World Health Organization declared that a pandemic was underway. In January, cruise lines began canceling port calls in China.

In January 2020, the Diamond Princess , a luxury ship owned by Carnival, began an ill-fated journey in Yokohama, Japan. More than 3,700 passengers and crew members were stranded on board for weeks, with little information about the pandemic.

But the virus spread relentlessly, and more than 700 people ultimately tested positive. In those early days of the pandemic, when people lacked natural immunity against the disease, and effective treatment and vaccines were not yet widely available, nine passengers died.

All major cruise lines suspended operations, as passengers canceled their bookings en masse. It became evident that a cruise ship wasn’t an ideal place to be in the middle of a pandemic.

In the stock market, cruise line shares plummeted as 2020 wore on. In that pandemic year, Carnival fell 57 percent, Royal Caribbean 44 percent, and Norwegian 56 percent. The companies had virtually no revenue and mounting debt, and their ability to remain going concerns was in doubt. They survived by taking on enormous debt loads and paying sky-high junk-bond yields, which were needed to attract investors.

The joyful atmosphere needed for a successful vacation at sea seemed unattainable.

An Incipient Recovery

It was only in 2022 that their finances — and share prices — stabilized, and only this year that they have begun to report sufficient earnings and cash flow to show signs of paring down their debt and returning to steady profit-making operations. In a conversation with stock analysts after reporting earnings in late June, Josh Weinstein, the chief executive of Carnival, said the company’s business volume was approaching 2019 levels for the first time since the start of the pandemic and, in some metrics, beginning to exceed it.

According to a transcript of the same session, David Bernstein, the company’s chief financial officer, said Carnival was pouring cash into debt reduction, “driving more than $8 billion in total debt reduction through 2026,” down from a $35 billion peak early in 2023.

These debt payments, combined with increased revenues, should enable the company to “approach investment grade” in its bond ratings in 2026, Mr. Bernstein said. Because of Carnival’s improving financial picture, the yields on the company’s debt have been declining and the price of its bonds, which move in the opposite direction, have risen.

The specifics of each company matter, of course. What the cruise lines have in common is that all have heightened safety procedures aimed at stemming the spread of any future outbreaks on board, commissioned new ships, taken measures to cut costs and embarked on fresh marketing campaigns. Wall Street analysts, including those at JPMorgan Chase, Bank of America and Jefferies, have given them high grades and helped to drive up their share prices.

Perhaps the magic of sea cruises is back. Certainly no one needs a recurrence of the dismal events of 2020.

In prepandemic times, I took a couple of lovely cruises. On one trip, three generations of my extended family were able to see the world together, while participating separately in age-appropriate recreation — on board, in the water and on land. So I’m personally pleased by the beginnings of a sea cruise renaissance, though not ready to sail again quite yet.

As an investor, I see the stock performance of the cruise lines this year less as a question of whether this is an opportune time to buy their shares and more as an affirmation of the ever-present need to diversify. What may seem safe today could easily become hazardous tomorrow.

Harry Markowitz, a Nobel laureate in economics who died last month, transformed modern investing with his teachings about how rigorous diversification can reduce risk. A decade ago, during a volatile stretch in the stock market, he told me that ordinary investors would be better off if they forgot about individual stocks and bought broad low-cost stock and bond index funds instead.

Allocate them in a proportion that makes you comfortable, and then devote yourself to more pleasant pursuits. Mr. Markowitz convinced me. As for pleasant pursuits, go with what delights you.

That could even be a sea cruise, if you find them fun and, at this stage, safe enough for a carefree voyage.

An earlier version of this article misstated when the World Health Organization declared a coronavirus pandemic. It was March 2020, not January 2020.

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Jeff Sommer writes Strategies , a column on markets, finance and the economy. He also edits business news. Previously, he was a national editor. At Newsday, he was the foreign editor and a correspondent in Asia and Eastern Europe. More about Jeff Sommer

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3 Top Cruise Ship Stocks To Watch in 2023

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Wondering which stocks are hot on the market this year? The cruise industry has rebounded remarkably well since the pandemic, with major cruise lines returning their full fleets to service, in some cases, anticipating record-breaking bookings, according to The Washington Post.

What does this mean for stock investors? Continue reading to learn about the top three cruise stocks to watch in 2023.

Overview of the Cruise Industry

The cruise industry consists of all business entities involved with tourism and transport on cruise ships. Cruise industry operations include cruise lines, cruise ship manufacturers and entertainment companies that specialize in cruise ship entertainment.

About Cruise Lines

A cruise line is a company that operates fleets of cruise ships and sells cruise experiences to customers. An all-inclusive cruise ticket will usually include:

• A stateroom aboard the cruise ship
• A variety of entertainment
• Stops at specified travel destinations, such as port stops

Global cruise lines are a major part of the larger travel industry that includes entertainment, leisure and hospitality management. Investors may see the benefits of buying stock in the rebounded cruise line companies.

Exploring the Top 3 Cruise Ship Stocks

Although cruise ship companies have suffered financial losses due to the COVID-19 pandemic and its aftermath, and the stocks are down 25% to over 50% in the last year despite consumers’ return to travel, investors can be hopeful for a strong rebound. Here’s a look at the three largest cruise line stocks based on market capitalization. As major players, they could prove to be bellwethers for cruise stocks overall.

Here’s some information about the three largest publicly traded companies in the cruise industry to help you make sound investment decisions if you choose to buy cruise line stocks in 2023.

1. Carnival Cruise Line (CCL)

Carnival once was the world’s largest cruise line operator and is now second to Royal Caribbean after the stock lost over half its value in 2022. It cruises to destinations all over the world. The cruise line’s Carnival Pride began sailing again in September 2021 — the first ship to set sail from the Baltimore cruise terminal in 18 months. This was a big deal as the world continued to reopen.

Prioritizing public health, Carnival aims to restore consumer confidence as a leading force in global economic recovery, travel and tourism. The company still has a strict vaccination and pre-cruise COVID-test policy in effect for cruises of 16 nights or more.

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Although the stock is down 52.49% over the past year, it has seen a 34.99% gain since Jan. 1. In its business update for the fourth quarter of 2022, the company reported a net loss in earnings per share but noted earnings were within the range it had predicted despite challenges like high fuel prices and unfavorable currency exchange rates. While occupancy levels were still low compared to 2019, Carnival beat 2019 on some metrics, including revenue per passenger per day and total customer deposits. Advanced booked positions for 2023 are also higher compared to 2019. Carnival CEO Josh Weinstein said the momentum established last year continued into December and bodes well for 2023.

2. Royal Caribbean Cruises Ltd. (RCL)

Royal Caribbean includes three popular subsidiary cruise lines: Royal Caribbean International, Celebrity Cruises and Silversea Cruises. Royal Caribbean has eliminated pre-cruise COVID testing and vaccination requirements for most sailings.

Prior to the pandemic, Royal Caribbean had placed orders for a number of new cruise ships, including a brand new class called the Icon Class, according to the company’s blog. Although the company had to scale back its timelines, passengers can still cruise on two new ships: Icon of the Seas and the world’s largest ship, Wonder of the Seas.

Royal Caribbean, like other stocks, declined steeply last year. However, it reported better-than-expected earnings in the third quarter of 2022, and other metrics are improving as well. “Load factors,” a measure of the number of booked passengers compared to the number needed to break even on a sailing, reached 96% overall and surpassed 100% on Caribbean sailings, according to a press release. The company expected the figure to reach 100% or more by the end of 2022. Booking volumes were better than the third quarter of 2019 in terms of future sailings, which the company attributed to eased COVID restrictions.

To ensure its continued performance improvement, Royal Caribbean has implemented a three-year initiative. Goals the company expects to reach by 2025 include exceeding 2019 earnings and returns on invested capital.

3. Norwegian Cruise Line Holdings (NCLH)

Coming in as the third-largest cruise line in the world, Norwegian has a fleet of 18 ships that sail to more than 300 global destinations. The company planned to expand its fleet by six ships between 2022 and 2027.

Norwegian has no COVID testing or vaccination requirements, although destinations might have requirements of their own. This gives Norwegian the same edge Royal Caribbean has over Carnival, which requires vaccines and pre-cruise COVID tests for longer sailings.

The cruise line reached a major milestone during the third quarter of 2022, the most recent reported, with positive adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, for the first time since the pandemic began. Frank Del Rio, president and chief executive officer of Norwegian Cruise Line Holdings Ltd., noted that the cruise line’s 2023 booked position equaled 2019’s record levels despite record-high pricing. Norwegian expects historical-level occupancy by mid-2023.

What To Consider Before Investing In Cruise Stocks

People waited anxiously to resume their vacations aboard cruise ships, but even after cruise lines resumed sailing, COVID restrictions and the risk of being stuck overseas in the event of infection made many would-be travelers leery about booking. Now that most of those restrictions have been lifted and the major cruise lines are reporting strong demand, the cruise industry might be a great place to invest despite economic uncertainty and ongoing challenges due to COVID.

Savvy investors concentrate on industries and businesses that they know, so they can understand and thoroughly research before buying stock . Sound investing involves learning companies’ business models and how they compare to other companies in the same industry.

With as much knowledge as possible about the cruise ship industry and how well the cruise lines are positioned, well-educated investors have a leg up over other investors.

What’s the Deal on Cruise Line Stocks Today?

Despite being one of the hardest-hit industries by the pandemic, cruise line stocks could be poised to rebound. Recovery thus far has been uneven, however , and the industry still faces significant challenges stemming from the pandemic.

Good To Know The 2021 Cruise Industry News Annual Report indicates that the Caribbean, Mediterranean and Asia/Pacific regions account for the three largest markets of the world’s cruise capacity. However, a number of cruise lines canceled Asia cruises for 2022.

As the focus on responsible tourism gains momentum in light of the impacts of the COVID-19 pandemic, the cruise industry continues its commitment to a healthier and prosperous future. Carnival, Royal Caribbean and Norwegian cruise lines are making strides to come back with a vengeance.

Will investors get a good return on their investment in these cruise line stocks? Time will tell.

Daria Uhlig contributed to the reporting for this article.

Data is accurate as of Jan. 18, 2023, and is subject to change .

This article has been updated with additional reporting since its original publication.

Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy .

• The Washington Post. 2022. "Cruises are smashing records despite covid on board: ‘Life goes on.’"
• The Maritime Executive. 2022. "Carnival Projects Full Fleet Operations and Return to Profitability."

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News & Insights

Top Stocks To Buy Now? 4 Cruise Line Stocks Making Headlines

April 30, 2021 — 11:11 am EDT

Written by Brett David for StockMarket.com  ->

These Top Cruise Line Stocks Are Trending In The Stock Market Now

As April comes to an end, you may be surprised to see that cruise line stocks are among the most active stocks today . Why is this industry making waves on the stock market , might you ask? Well, this is likely thanks to the latest announcement from the U.S. Centers for Disease Control and Prevention (CDC). Through a letter to the cruise industry earlier this week, the CDC announced that cruises can operate this year. For starters, the mid-July time frame would allow for summer voyages which would appeal to eager cruisers right now. At the same time, investors could be eyeing the top cruise ship stocks as well.

On one hand, conventional cruise operators like Lindblad Expeditions ( NASDAQ: LIND ) would be caught in this tailwind now. On the other hand, even travel companies that facilitate cruising such as Expedia ( NASDAQ: EXPE ) would be viable plays. As it stands, both companies’ shares are looking at gains of over 130% in the past year. However you look at it, the cruise industry just received a major boost.

By and large, all this would add to the current momentum seen by the tourism industry overall. Besides, demand for cruises and other travel services would be at a high now. This could be the case seeing as consumers have been anchored for more than a year. Given all of this, would you be willing to invest in these top cruise line stocks in the stock market today?

Top Cruise Line Stocks To Buy [Or Avoid] Now

• Carnival Corporation ( NYSE: CCL )
• Royal Caribbean Cruises Limited ( NYSE: RCL )
• Norwegian Cruise Line Holdings ( NYSE: NCLH )
• Walt Disney Company ( NYSE: DIS )

Carnival Corporation

Carnival is a leisure travel company that has been in the limelight recently. In essence, the company is a cruise company and a provider of vacations to all cruise destinations throughout the world. It covers North America, Australia, Europe, and Asia. CCL stock currently trades at $27.74 as of 10:12 a.m. ET and has been up by over 30% year-to-date. Last week, the company announced that its Costa Cruises has unveiled its 2021 cruise vacations in the Mediterranean.

It has also been making huge plays ahead of reopening by July. To assure customer safety, the company will include enhanced health and safety procedures for all aspects of its cruise experience. This is crucial because as the world reopens, companies like Carnival must prioritize public health while restoring consumer confidence and driving global economic recovery in the travel and tourism industries. Also, Carnival announced last week that its Seabourn ultra-luxury cruise line has partnered with the government of Barbados to restart guest sailings. Given all these reopening plays by the company, will you consider buying CCL stock?

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Royal Caribbean Cruises Ltd

Royal Caribbean is a global cruise holding company that is based in Florida. It is the world’s second-largest cruise line operator, after Carnival Corporation. The company’s three cruise lines include Royal Caribbean International, Celebrity Cruises, and Silversea Cruises. RCL stock currently trades at $86.09 as of 10:14 a.m. ET and has been up by over 75% in the last year. On Thursday, the company provided a crucial business update and reported its first-quarter financials.

Like Carnival, the company has been announcing new itineraries for this summer. In detail, it has 11 additional ships from the Caribbean and Europe in addition to the four ships already sailing. Impressively, the company has received a positive reaction to these announcements, highlighting the strong demand for cruising. These cruises are taking place with adjusted passenger capacity and the enhanced health protocols developed with government and health authorities, and guidance from the Healthy Sail Panel. With these exciting developments surrounding Royal Caribbean, will you consider adding RCL stock to your portfolio?

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Norwegian Cruise Line Holdings Ltd.

Norwegian is a cruise line that is the third-largest cruise line in the world. The company boasts a combined fleet of 28 ships with approximately 59,150 berths. Furthermore, these brands offer itineraries to more than 490 destinations worldwide. It also plans to introduce nine additional ships through 2027. NCLH stock currently trades at $30.52 as of 10:16 a.m. ET and has seen over a 25% increase year-to-date. On Wednesday, the company unveiled the next phase of its long-awaited plan to resume cruising outside of the U.S. this summer.

The company’s Oceania Cruises will resume operations with sailings to Scandinavia and Western Europe beginning in August and Regent Seven Seas Cruises will restart from the U.K. in September. All initial voyages will operate with fully vaccinated guests and crew in addition to the company’s robust, multi-layered SailSAFE health and safety program. Among the key features in this program includes universal coronavirus testing before embarkation. With that in mind, will you consider buying NCLH stock?

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Walt Disney Company

Last but not least, we have the Walt Disney Company. To begin with, yes, most would not immediately think of Disney as a cruise ship stock. Given its explosive growth in the streaming industry recently, I can understand. However, the Disney Cruise Line is another stream of revenue for Disney. With the CDC’s latest announcement, the company would be receiving another boost on the tourism front. This coupled with Disney’s theme parks opening could make for the perfect storm for the company. Ideally, we could see a scenario where Disney is firing on all cylinders in a post-pandemic world. Because of this, could investors continue to drive DIS stock’s prices up?

For one thing, Disney has been hard at work preparing for the continuation of cruise voyages. During a virtual event yesterday, Disney unveiled its newest cruise ship, the Disney Wish. In particular, the Disney Wish marks the fifth ship in the Disney Cruise Line fleet. On this ship, Disney is offering experiences based on the legendary Star Wars and Marvel IPs from its portfolio. According to Disney, voyages to the Bahamas and Castaway Cay will be open for booking on May 27. Yet again, the company appears to be making the most of its massive media portfolio. Time will tell if Disney can appeal to travel-starved consumers. In the meantime, would you consider DIS stock a buy?

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Buy Cruise Line Stocks? The Pros Aren't So Sure

Cruise line stocks have performed well so far in 2021, but analysts are still sitting on the sidelines amid cloudy reopening plans. 

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Cruise line stocks have been sailing higher in 2021 on expectations the major lines will hit the open waters again this year. And they earned a boost earlier this month after the U.S. Centers for Disease Control and Prevention (CDC) issued much-anticipated reopening guidelines for travel ship operators.

More recently, though, some of the wind has been taken out of cruise stocks' sails.

CDC guidelines have failed to provide a specific reopening date for cruise operators. Concerns that rising debt levels could negatively impact shareholder value are another hurdle.

13 Best Infrastructure Stocks for America's Big Building Spend

And cruise line stocks recently took another recent hit after the U.S. Food and Drug Administration (FDA) and CDC suggested halting the use of Johnson & Johnson's ( JNJ ) single-dose COVID-19 vaccine after six women developed blood clots within two weeks of getting their shots – potentially tapping the brakes on the pace of immunization.

The concern could be short-lived, considering nearly 7 million people in the U.S. have received the JNJ shot. And in a joint statement issued by the two federal agencies, they said they are "recommending a pause in the use of this vaccine out of an abundance of caution," adding that the "adverse events appear to be extremely rare."

Michael Reinking, senior market strategist at the New York Stock Exchange, adds that "The White House has said that there will not be a 'significant impact' on vaccinations overall" due to the recommendation.

While valuations for these recovery stocks might be elevated given their run higher this year, the recent pullback in cruise line names could be a potential entry point for those looking to ride out the choppy waters.

So, is it time to jump in? Read on as we look at three cruise line stocks to see which ones, if any, analysts like ahead of a possible summer restart.

The 21 Best Stocks to Buy for the Rest of 2021

Data is as of April 13. Stocks are listed in order of best year-to-date returns.

• Market value: $33.4 billion
• Year-to-date return: 28.4%

Miami-based Carnival ( CCL , $27.82) operates 87 ships in both the U.S. and abroad that dock at roughly 700 ports, and it does so under several brand names, including Carnival Cruise Line and Princess Cruises. Carnival, which typically sells its cruises through travel agents and tour operators, has paused all operations from its U.S. ports until June 30.

CCL shares traded above $50 in January 2020 before plunging into single digits just two months later. The cruise line stock has recovered about half of its pre-pandemic value, and is up more than 28% so far in 2021.

Stifel analyst Steven Wieczynski is confident there are calmer waters ahead. He rates the stock a Buy with a $35 price target, implying upside of more than 26% over the next 12 months or so.

"We expect CCL to emerge from this crisis as a leaner, more efficient company, which, combined with our continued confidence in the resilience of global cruise industry demand, strengthens our conviction in owning shares," Wieczynski says.

But the broader analyst community has mixed feelings on this cruise line stock. Of the 18 analysts covering CCL tracked by S&P Global Market Intelligence, six call it a Strong Buy, one says it's a Buy, seven maintain a Hold rating and four believe it's a Strong Sell. Perhaps more worrisome: Their average 12-month price target of $26.78 translates into 4% downside from current levels, suggesting it might be better to wait for a substantial dip before considering Carnival shares.

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Royal Caribbean Cruises

• Market value: $22.1 billion
• Year-to-date return: 15.9%

Royal Caribbean Cruises ( RCL , $86.53), also headquartered in Miami, visits more than 270 destinations across 72 countries, operating under the Royal Caribbean International, Celebrity Cruises and Silversea Cruises brands. Combined with its 50% interest in a joint venture, TUI Cruises, RCL boasts a 61-ship fleet with another 15 on order.

Like Carnival, Royal Caribbean shares plunged during the COVID bear market. The cruise line stock dropped from around $135 in February to below $20 by late March. Shares have more than quadrupled off this pandemic-era low, however. Buoying hopes are the resumption of sailing in Singapore onboard its Quantum of the Seas ship, and plans to get its broader operations up and running by July 1.

Wedbush analyst James Hardiman rates RCL stock at Outperform (equivalent of Buy) with a 12-month price target of $115, implying 33% upside from here.

"We believe our August restart assumption [for cruise lines] remains reasonable, and that under this scenario, cruise stocks represent significant value, with RCL our favorite in the group," he says.

But the bulk of analysts tracked by S&P Global Market Intelligence are fairly complacent when it comes to RCL stock. While five of the 18 following the stock maintain a Strong Buy rating, and two say it's a Buy, seven believe Royal Caribbean is a Hold, two believe it's a Sell and two rate it a Strong Sell. Their anticipated upside is telling, too; a PT of $86.23 suggests RCL shares are fairly priced at current levels.

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Norwegian Cruise Line Holdings

• Market value: $10.9 billion
• Year-to-date return: 15.7%

Miami is a hot spot for cruise line companies, with the main offices of Norwegian Cruise Line Holdings' ( NCLH , $29.41) located there, as well. The company operates 28 ships globally across several brands, including its namesake Norwegian Cruise Line, as well as Oceania Cruises and Regent Seven Seas Cruises. NCLH is planning to resume limited global operations in early July.

NCLH was trading just shy of the $60 mark in early 2020 before the cruise line stock crashed all the way down to $7 by mid-March. Shares have since been recovering from record-low territory, and hit a year-to-date high near $35 early last month.

Argus Research analyst John Staszak is tepid on both RCL's shorter- and longer-term outlooks, and maintains a Hold recommendation on the cruise stock.

"While Norwegian Cruise Lines offers travelers an attractive value proposition, it must still compete with other types of vacations (i.e., flights and land-based trips) that many believe to be safer choices as a result of the pandemic," he says. "We thus believe that cruise operators will have to work hard to lure customers back, which could mean lower net yields."

Again, this echoes the broader sentiment seen among the analysts tracked by S&P Global Market Intelligence, though NCLH does have the smallest bear camp of the three major cruise line stocks. Of the 17 analysts following NCLH, four call it a Strong Buy, two say Buy, 10 call it a Hold while just one deems it a Strong Sell. And an average price target of $31.00 implies at least some (albeit modest) upside of about 5% over the next 12 months or so.

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With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.

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Norwegian Cruise Stock Up 17% in a Month: Should You Dive in?

Norwegian Cruise Line Holdings Ltd. ‘s ( NCLH Quick Quote NCLH - Free Report ) shares are showing signs of a strong comeback after a rocky six months with a 7.9% decline. In the past month, the stock has moved up 16.7% compared with the industry ’s 13.3% increase and the S&P 500's 8.7% rise. The company’s recent momentum suggests a promising turnaround amid broader market gains. As of Monday, the stock closed at $17.89, below its 52-week high of $21.73 but above its 52-week low of $12.71. In the same timeframe, other industry players have also registered notable gains. Royal Caribbean Cruises Ltd. ( RCL Quick Quote RCL - Free Report ) rose 17.8%, Carnival Corporation & plc ( CCL Quick Quote CCL - Free Report ) increased 14.6% and OneSpaWorld Holdings Limited ( OSW Quick Quote OSW - Free Report ) moved up 5%.  

Technical indicators suggest continued strong performance for NCLH. The stock is trading above its 50-day moving averages, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in NCLH's financial health and prospects.

50-Day Moving Averages

Factors Favoring NCLH Stock Surge

Strong booking continues to drive the company's performance. Robust bookings for European, Caribbean and Alaskan sailings, where much of the capacity was focused, drove the company’s second-quarter 2024 top line. The company is also benefiting from stronger-than-expected onboard revenues and last-minute bookings. Guests' continued interest in shore excursions and amenities, including specialty restaurants and communication services, enhanced by the ongoing implementation of Starlink across the fleet, bode well. NCLH is enhancing the guest experience by investing in digital innovations and ROI-driven initiatives to boost satisfaction and operational efficiency. A key upgrade is the rapid deployment of Starlink high-speed Internet, already installed on half of its fleet since spring 2023, with full rollout expected by the end of 2024. The company is also improving pre-cruise planning and offering new digital tools across its brands. During second-quarter 2024, the company demonstrated its commitment to sustainability by meeting its 2024 goal of equipping 50% of the fleet with shore power technology a year ahead of schedule. It aims to equip 70% of the fleet with this technology by 2025. The launch of shore power at Port Miami marked a significant milestone, making it the first major U.S. East Coast cruise port to offer shore power at five terminals, including Terminal B, the Pearl of Miami. The company achieved its goal of testing 20% of the fleet with biodiesel blends, with plans to expand testing to 40% by 2024. Norwegian Cruise is actively working to grow its fleet, which currently consists of 32 ships. The company plans to add the last of its Allura Class ships under the Oceania Cruises brand, expected for delivery in 2025. NCLH has four Prima Class ships on order, including two methanol ready next-generation ships, with deliveries scheduled between 2025 and 2028. The company expects to introduce 13 new ships under three new classes from 2025 through 2036. This includes four Oceania Cruises ships with deliveries planned from 2027 through 2031 and two Prestige Class Ships scheduled for 2026 and 2029.

Estimate Revision Favoring the NCLH Stock

Reflecting the positive sentiment around NCLH, the Zacks Consensus Estimate for earnings per share has seen upward revisions. In the past 30 days, analysts have raised their estimates for the current and next fiscal by 8.3% to $1.56 and 5.1% to $1.87 per share, respectively. These estimates indicate year-over-year growth rates of 122.9% and 19.7%, respectively.

NCLH Trading at a Discount

The company is currently valued at a discount compared with the industry on a forward 12-month P/E basis. NCLH’s forward 12-month price-to-earnings ratio stands at 11.87, lower than the industry’s ratio of 15.59 and the S&P 500's ratio of 21.68.

Investors might find NCLH appealing for their portfolios, given its current Zacks Rank #1 (Strong Buy) rating. NCLH stock is an attractive investment opportunity due to its strong recent performance, promising growth prospects and favorable valuation. Robust booking trends, particularly in key markets like Europe, the Caribbean and Alaska, bode well. Additionally, the company's plans to expand its fleet with new, modern ships, alongside upward revisions in earnings estimates indicating significant growth, highlight its positive outlook. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .

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Norwegian Cruise Stock Up 17% in a Month: Should You Dive in?

Norwegian Cruise Line Holdings Ltd. ‘s NCLH shares are showing signs of a strong comeback after a rocky six months with a 7.9% decline. In the past month, the stock has moved up 16.7% compared with the industry’s 13.3% increase and the S&P 500's 8.7% rise. The company’s recent momentum suggests a promising turnaround amid broader market gains.

As of Monday, the stock closed at $17.89, below its 52-week high of $21.73 but above its 52-week low of $12.71. In the same timeframe, other industry players have also registered notable gains. Royal Caribbean Cruises Ltd. RCL rose 17.8%, Carnival Corporation & plc CCL increased 14.6% and OneSpaWorld Holdings Limited OSW moved up 5%.

Technical indicators suggest continued strong performance for NCLH. The stock is trading above its 50-day moving averages, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in NCLH's financial health and prospects.

50-Day Moving Averages

Factors Favoring NCLH Stock Surge

Strong booking continues to drive the company's performance. Robust bookings for European, Caribbean and Alaskan sailings, where much of the capacity was focused, drove the company’s second-quarter 2024 top line. The company is also benefiting from stronger-than-expected onboard revenues and last-minute bookings. Guests' continued interest in shore excursions and amenities, including specialty restaurants and communication services, enhanced by the ongoing implementation of Starlink across the fleet, bode well.

NCLH is enhancing the guest experience by investing in digital innovations and ROI-driven initiatives to boost satisfaction and operational efficiency. A key upgrade is the rapid deployment of Starlink high-speed Internet, already installed on half of its fleet since spring 2023, with full rollout expected by the end of 2024. The company is also improving pre-cruise planning and offering new digital tools across its brands.

During second-quarter 2024, the company demonstrated its commitment to sustainability by meeting its 2024 goal of equipping 50% of the fleet with shore power technology a year ahead of schedule. It aims to equip 70% of the fleet with this technology by 2025. The launch of shore power at Port Miami marked a significant milestone, making it the first major U.S. East Coast cruise port to offer shore power at five terminals, including Terminal B, the Pearl of Miami. The company achieved its goal of testing 20% of the fleet with biodiesel blends, with plans to expand testing to 40% by 2024.

Norwegian Cruise is actively working to grow its fleet, which currently consists of 32 ships. The company plans to add the last of its Allura Class ships under the Oceania Cruises brand, expected for delivery in 2025. NCLH has four Prima Class ships on order, including two methanol ready next-generation ships, with deliveries scheduled between 2025 and 2028.

The company expects to introduce 13 new ships under three new classes from 2025 through 2036. This includes four Oceania Cruises ships with deliveries planned from 2027 through 2031 and two Prestige Class Ships scheduled for 2026 and 2029.

Estimate Revision Favoring the NCLH Stock

Reflecting the positive sentiment around NCLH, the Zacks Consensus Estimate for earnings per share has seen upward revisions. In the past 30 days, analysts have raised their estimates for the current and next fiscal by 8.3% to $1.56 and 5.1% to $1.87 per share, respectively. These estimates indicate year-over-year growth rates of 122.9% and 19.7%, respectively.

NCLH Trading at a Discount

The company is currently valued at a discount compared with the industry on a forward 12-month P/E basis. NCLH’s forward 12-month price-to-earnings ratio stands at 11.87, lower than the industry’s ratio of 15.59 and the S&P 500's ratio of 21.68.

Investors might find NCLH appealing for their portfolios, given its current Zacks Rank #1 (Strong Buy) rating. NCLH stock is an attractive investment opportunity due to its strong recent performance, promising growth prospects and favorable valuation. Robust booking trends, particularly in key markets like Europe, the Caribbean and Alaska, bode well. Additionally, the company's plans to expand its fleet with new, modern ships, alongside upward revisions in earnings estimates indicating significant growth, highlight its positive outlook.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .

Zacks Investment Research

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10 best cruise stocks to buy now.

In this article, we will be looking at the 10 best cruise stocks to buy now. To skip our detailed analysis of the leisure travel industry and its future outlook, you can click to see the 5 Best Cruise Stocks to Buy Now .

When travel restrictions were put in place because of the outbreak of the coronavirus pandemic, the travel industry as a whole took a huge hit, but more than any other sector, the cruise line sector may be the one that was impacted most at the time. According to the Carnival Corporation & plc's (NYSE: CCL ) 2020 annual report , while the global cruise line sector made a $3 billion profit in 2019, in 2020, it ended up with a $10 billion loss with its revenues plunging by 73%. This is unsurprising because the global community clamped down on all forms of travel because of COVID-19, and leisure travel ended up being the first to go for many. This had unprecedented effects on many aspects relating to the operation of the cruise industry, leading to a loss of over $77 billion in global economic activity, 518,000 jobs, and $23 billion in wages in 2019 alone, according to the Cruise Lines International Association's 2021 State of the Cruise Industry Outlook .

Despite this, the cruise line sector has proven to be highly profitable for the global economy, reporting a contribution of over $154 billion in 2019, according to Cruise Lines International Association . While the coronavirus pandemic undoubtedly led to the sector suffering heavy losses, we can still expect it to bounce back in the coming years, particularly since with the administration of more COVID-19 vaccinations worldwide, travel restrictions and lockdowns are beginning to be eased again. According to Cruise Market Watch , the market share for the global cruise industry is estimated at $23.8 billion in 2021. This marks a rise of 81.8% from the market share of 2020, signaling growth and the industry's potential to get back on its feet, but it is still representative of a 52.9% decline from 2019, meaning that the prospective growth, while present, is due to be slow.

Regardless, the industry's growth cannot be denied, even though it is expected to be slow-paced. The growth itself is also being aided by governments worldwide, with the US government, for instance, having signed multiple COVID-19 relief bills in 2020 to help industries like the airline and cruise industries get back on their feet after getting hit by the pandemic. Early in 2020, about $8.3 billion was given away to aid industries that were struggling, according to CNBC . However, while this was helpful for US companies, major industry players like the Royal Caribbean Group (NYSE: RCL ), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH ), and Carnival Corporation & plc (NYSE: CCL) that were incorporated in different countries were still left hanging.

Despite the above, these companies have managed to weather the storm and bounce back from the financial losses suffered since the pandemic broke out. For instance, Carnival Corporation & plc (NYSE: CCL) brought in $6 billion in April last year. This indicates the hope may not be lost for the cruise industry just yet, and so we have compiled a list of the best cruise stocks to buy now.

Investing is becoming difficult by the day, even for the smart money. The entire hedge fund industry is feeling the reverberations of the changing financial landscape. Its reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26th 2021 our monthly newsletter’s stock picks returned 197.2%, vs. 72.4% for the SPY. Our stock picks outperformed the market by more than 124 percentage points ( see the details here ). We were also able to identify in advance a select group of hedge fund holdings that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 13% through November 16th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

Photo by Stephanie Klepacki on Unsplash

With this context and industry outlook in mind, let's now take a look at the 10 best cruise stocks to buy now. We took into account hedge fund sentiment, fundamentals, future growth catalysts and analysts' ratings while choosing these stocks.

Best Cruise Stocks to Buy Now

10. tui ag (otcmkts: tuiff).

Number of Hedge Fund Holders: N/A

TUI AG (OTCMKTS: TUIFF) is a tourism company operating worldwide and based in Hanover, Germany. The company operates resorts and hotels under the Robinson, Riu, TUI Blue, and other brands. It also has its own cruise liners and is ranked 10th on our list of the best cruise stocks to buy now.

For the fiscal first quarter of 2021, TUI AG (OTCMKTS: TUIFF) had $571.83 million in revenue. The stock has a market cap of $6.08 billion and has gained 6% in the past year. According to Winds Research, the company stands to benefit from a prospective boom in travel after the pandemic.

Like the Royal Caribbean Group (NYSE: RCL), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH), and Carnival Corporation & plc (NYSE: CCL), this is a good cruise stock to invest in.

9. Genting Hong Kong Limited ( OTCMKTS: GTHKF)

Genting Hong Kong Limited ( OTCMKTS: GTHKF) is an investment holding company that operates passenger cruise ships in the US and internationally. The company has three segments: the Cruise and Cruise-Related Activities, Shipyard, and Non-Cruise Activities segments. It ranks 9th on our list of the best cruise stocks to buy now.

The company has a market cap of $666.37 million and $366.82 million in revenue, trailing three months. The stock has gained 89% in the past 6 months and 152% year to date. Like the Royal Caribbean Group (NYSE: RCL), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH), and Carnival Corporation & plc (NYSE: CCL), this is a good cruise stock to invest in.

8. Nippon Yusen Kabushiki Kaisha (OTCMKTS: NPNYY)

Nippon Yusen Kabushiki Kaisha (OTCMKTS: NPNYY) is a sea, land, and air transportation service provider. The company operates worldwide and offers a range of services, including liner trading and air cargo transportation services. It ranks 8th on our list of the best cruise stocks to buy now.

For the fiscal first quarter of 2021, Nippon Yusen Kabushiki Kaisha (OTCMKTS: NPNYY) had $3.34 billion in revenue, and it also has a gross profit margin of 14.5%. The stock has grown 39.55% in the past three months versus the S&P 500's 8.47% growth. It has also gained 126.7% in the past 6 months and 114.1% year to date. According to the Wall Street Journal, Nippon Yusen Kabushiki Kaisha (OTCMKTS: NPNYY) has a consensus Buy rating.

7. Lindblad Expeditions Holdings, Inc. ( NASDAQ: LIND )

Number of Hedge Fund Holders: 11

Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND) provides expedition cruising and adventure traveling opportunities. It has a fleet of nine owned expedition ships alongside five seasonal charter vessels operating under the Lindblad brand. The company ranks 7th on our list of the best cruise stocks to buy now.

In June, Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND) revealed that the company's CEO Dolf Berle, bought about 36,500 shares of common stock in May, worth about $636,000. Deutsche Bank also raised the stock's price target from $14 to $16 this May. This March, Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND) announced that they would be resuming operations in 2021, just in time for the voyage season in Alaska and Galápagos in June. The stock rose after the announcement. In the first quarter of 2021, the company's EPS was -$0.66 versus estimates of -$0.55. Its revenue for the quarter was $1.78 million, beating estimates by $0.85 million. The stock has gained 3.21% in the past 6 months and 3.74% year to date.

By the end of the first quarter of 2021, 11 hedge funds out of the 866 tracked by Insider Monkey held stakes in Lindblad Expeditions Holdings, Inc. (NASDAQ: LIND). Their total stake value was roughly $105 million. This is compared to 11 hedge fund holders with a total stake value of roughly $99 million in the previous quarter. Like the Royal Caribbean Group (NYSE: RCL), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH), and Carnival Corporation & plc (NYSE: CCL), this is a good cruise stock to invest in.

6. OneSpaWorld Holdings Limited ( NASDAQ: OSW )

OneSpaWorld Holdings Limited (NASDAQ: OSW) is a company that operates health and wellness centers on board its cruise ships and at destination resorts around the world. The company offers services such as salon and skincare services and products, self-service fitness facilities, and specialized fitness classes, among others. It ranks 6th on our list of the best cruise stocks to buy.

On June 24th, OneSpaWorld Holdings Limited (NASDAQ: OSW) announced the price of its secondary stock offering of 8,421,053 common shares. The stock offering has been priced at $9.5. In the first quarter of 2021, OneSpaWorld Holdings Limited (NASDAQ: OSW) had an EPS of -$0.21. Its revenue for the quarter was $5.59 million, beating estimates by $1.79 million. The stock has also gained 16.22% in the past 6 months and 8.53% year to date.

By the end of the first quarter of 2021, 11 hedge funds out of the 866 tracked by Insider Monkey held stakes in OneSpaWorld Holdings Limited (NASDAQ: OSW). Their total stake value was roughly $130 million. This is compared to 12 hedge fund holders with a total stake value of roughly $115 million in the previous quarter. Like the Royal Caribbean Group (NYSE: RCL), Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH), and Carnival Corporation & plc (NYSE: CCL), OneSpaWorld Holdings Limited (NASDAQ: OSW) is a good cruise stock to invest in.

FAM Funds, an investment management firm, mentioned OneSpaWorld Holdings Limited (NASDAQ: OSW) in their fourth-quarter 2020 investor letter. Here's what they said:

“In late January, we introduced a new idea into the Fund — OneSpaWorld (OSW). In hindsight, this move was unfortunate. OSW’s primary business lies in managing spas on cruise ships, almost all of which outsource spa services. OSW dominates the business with more than 90% market share and is typically highly profitable. Historically, OSW grew through recessions and past virus outbreaks like H1N1, SARS, and MERS, as cruise ship owners slashed ticket prices to keep their vessels full. At the time of our purchase, COVID-19 looked, to us, comparable to past viruses. By the time it was clear that it was a serious threat to the industry, the stock price had collapsed. While both frustrated and disappointed, we decided that the right course of action was to hold our position. We believe that, eventually, the public will resume cruising and OSW should benefit. As optimism grew in the second half of the year about the potential for improved cruising conditions, the stock price partially rebounded.”

Click to continue reading and see the 5 Best Cruise Stocks to Buy Now .

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Disclosure: None. 10 Best Cruise Stocks to Buy Now is originally published on Insider Monkey.