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- Undervalued Value Stocks: Royal Caribbean Cruises
Undervalued Value Stocks: Royal Caribbean Cruises
Cruise liners operators are one of the market segments that greatly suffered during the pandemic. But the situation has improved, as the World Health Organisation (WHO) recently declared that the pandemic is over. So, Royal Caribbean could now recovery. RCL stocks dropped to $20 in 2020 and have recovered to $75 since then, but prices are still lower than $135 that were recorded in 2019. The Q1 2023 made losses to the company but they are much less than before. RCL revenues were recorded at $2.9 billion compared to $2.5 billion in Q1 2019, while EPS was negative at -$0.23, beating analysts’ expectations of -$0.69.
Such developments are pointing to the fact that the company is on its way to a recovery much faster than expected. The management expects EPS at $4.60 in 2023 and at $10 by the end of 2024, while analysts’ consensus is at $8.4. This target could be upgraded when the company delivers its new earnings report.
Royal Caribbean has reported bookings during Q1 2023 at $5.3 billion compared to $4.2 billion at the end of 2022. The management expects a record operational profit in 2023 that will allow the company to cover most of the losses caused by the pandemic.
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