Royal Caribbean Cruises Ltd. (RCL) looking to reclaim success with recent performance

Royal Caribbean Cruises Ltd. (NYSE: RCL) stock fell -2.02% on Wednesday to $77.26 against a previous-day closing price of $78.85. With 3.46 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.54 million shares. During the session, the Travel Services company that operates in wider Consumer Cyclical sector, reached to the highest price of $78.00 whereas the lowest price it dropped to was $76.31. The 52-week range on RCL shows that it touched its highest point at $81.16 and its lowest point at $31.09 during that stretch. It currently has a 1-year price target of $85.92. Beta for the stock currently stands at 2.41.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of RCL was down-trending over the past week, with a drop of -2.93%, but this was up by 27.94% over a month. Three-month performance surged to 7.74% while six-month performance rose 31.48%. The stock gained 39.51% in the past year, while it has gained 56.30% so far this year. A look at the trailing 12-month EPS for RCL yields -4.06 with Next year EPS estimates of 6.91. For the next quarter, that number is 1.51. This implies an EPS growth rate of 59.50% for this year and 46.47% for next year.

Float and Shares Shorts:

At present, 255.47 million RCL shares are outstanding with a float of 219.97 million shares on hand for trading. On Apr 27, 2023, short shares totaled 18.49 million, which was 7.23% higher than short shares on Mar 30, 2023. In addition to Mr. Jason T. Liberty as the firm’s Pres, CEO & Director, Mr. Naftali Holtz serves as its Chief Financial Officer.

Institutional Ownership:

Through their ownership of 74.81% of RCL’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 49.09% of RCL, in contrast to 24.71% held by mutual funds. Shares owned by individuals account for 24.37%. As the largest shareholder in RCL with 11.25% of the stake, Capital Research & Management Co holds 28,719,374 shares worth 28,719,374. A second-largest stockholder of RCL, Capital Research & Management Co, holds 28,631,369 shares, controlling over 11.21% of the firm’s shares. The Vanguard Group, Inc. is the third largest shareholder in RCL, holding 23,250,499 shares or 9.11% stake. With a 7.82% stake in RCL, the American Funds Growth Fund of Ame is the largest stakeholder. A total of 19,969,827 shares are owned by the mutual fund manager. The American Funds Investment Company, which owns about 6.42% of RCL stock, is the second-largest Mutual Fund holder. It holds 16,387,830 shares valued at 1.07 billion. Vanguard Total Stock Market ETF holds 2.64% of the stake in RCL, owning 6,746,150 shares worth 441.4 million.

An Overview of Recent Financials:

Understanding a company as a customer does not mean you will understand it as an investor. The wise investor uses quantitative research to analyze metrics such as revenue, net income, and earnings. In its fiscal quarter reported on Mar 30, 2023, RCL reported revenue of $2.18B and operating income of -$229.59M. The EBITDA in the recently reported quarter was $121.72M and diluted EPS was -$2.05.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for RCL since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With RCL analysts setting a high price target of $104.00 and a low target of $70.00, the average target price over the next 12 months is $87.64. Based on these targets, RCL could surge 34.61% to reach the target high and fall by -9.4% to reach the target low. Reaching the average price target will result in a growth of 13.44% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded RCL stock several times over the past three months with 4 Buys and 9 Sells. In these transactions, 25,671 shares were bought while 43,275 shares were sold. The number of buy transactions has increased to 32 while that of sell transactions has risen to 50 over the past year. The total number of shares bought during that period was 275,729 while 1,564,631 shares were sold.

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