With bookings ahead of 2019 levels, cruise lines are gearing up for smooth sailing.
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Embarking on a cruise is like floating through the stock market—a mix of excitement and uncertainty. Cruise stocks, much like the unpredictable seas, can offer a captivating ride for investors. Yet, beneath the waves of market whims, they can be tenuous voyages better suited for trading than long-term holding.
Consider this as you weigh your options with the tide of consumer spending shifting. Cruise bookings are cast months in advance, like ancient maps charting distant lands. Amidst economic tempests, cruise lines showcase resilient booking levels stretching into the horizon of 2025.
These steadfast voyages ensure that many cruise lines will continue to navigate prosperous waters independent of broader economic currents. Below, we highlight three cruise stocks that present inviting possibilities for investors seeking to ride the wave of opportunity.
Carnival (CCL)
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Carnival (NYSE:CCL) emerges on the horizon as an alluring option among cruise stocks in the current trough. Anticipation swells as the company’s forthcoming June 25, 2024 earnings report looms. Investors await eagerly, hoping to witness revenue charts not only climbing year-on-year but cresting above the thresholds of 2019.
Carnival bears the weight of substantial debts, a burden often unwelcome, particularly in the realm of travel endeavors. Yet, despite this ballast, the company boasts record-breaking booking figures at significantly elevated prices, maneuvering to trim virtually $8 billion in debts during its latest fiscal quarter.
Such progress fuels optimism among analysts, propelling CCL stock to an average price target of $20.99—a beacon shining 30% higher than its closing price on June 21, 2024.
Viking Holdings (VIK)
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Amidst the trading tides, it pays to adhere to market gifts rather than buck their current—enter Viking Holdings (NYSE:VIK). A fledgling in the market’s expanse, this entity has only recently unfurled its sails to trading winds, debuting on May 1, 2024, with an initial upsurge of about 20%. However, recent market maelstroms have steered the stock approximately 10% off course, culminating on June 21, 2024.
Viking’s compass points toward affluent, childless travelers, distinguishing itself by spotlighting destinations over vessels. Young passengers are not permitted, and casinos are conspicuously absent on board. Their audience veers toward those above 55, a demographic largely resistant to inflation’s caprices—an audience apt to indulge in Viking’s “modern luxury.”
While the valuation currently rides high on market waves, it’s premature to cast a long-term verdict on VIK stock with just one fiscal report in hand.