Royal Caribbean (RCL) closed at $280.16 in the latest trading session, marking a -1.09% move from the prior day. The stock's performance was behind the S&P 500's daily gain of 0.64%. On the other hand, the Dow registered a gain of 1.23%, and the technology-centric Nasdaq increased by 0.69%.
The cruise operator's stock has climbed by 9.94% in the past month, exceeding the Consumer Discretionary sector's loss of 0.05% and the S&P 500's gain of 0.55%.
Investors will be eagerly watching for the performance of Royal Caribbean in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $2.8, reflecting a 71.78% increase from the same quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $4.27 billion, showing a 13.44% escalation compared to the year-ago quarter.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $15.64 per share and a revenue of $17.95 billion, indicating changes of +32.54% and 0%, respectively, from the former year.
Investors should also note any recent changes to analyst estimates for Royal Caribbean. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the business outlook.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.02% higher. Right now, Royal Caribbean possesses a Zacks Rank of #3 (Hold).
Looking at valuation, Royal Caribbean is presently trading at a Forward P/E ratio of 15.81. For comparison, its industry has an average Forward P/E of 17.73, which means Royal Caribbean is trading at a discount to the group.
Also, we should mention that RCL has a PEG ratio of 0.74. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. As the market closed yesterday, the Leisure and Recreation Services industry was having an average PEG ratio of 1.2.
The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. With its current Zacks Industry Rank of 47, this industry ranks in the top 20% of all industries, numbering over 250.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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