The latest trading session saw Royal Caribbean (RCL) ending at $211.31, denoting a +1.84% adjustment from its last day's close. This change lagged the S&P 500's 2.03% gain on the day. Elsewhere, the Dow saw an upswing of 1.23%, while the tech-heavy Nasdaq appreciated by 2.74%.
Prior to today's trading, shares of the cruise operator had lost 5.62% over the past month. This has lagged the Consumer Discretionary sector's loss of 4.94% and the S&P 500's loss of 5.07% in that time.
Investors will be eagerly watching for the performance of Royal Caribbean in its upcoming earnings disclosure. The company's earnings report is set to be unveiled on April 29, 2025. It is anticipated that the company will report an EPS of $2.52, marking a 42.37% rise compared to the same quarter of the previous year. Simultaneously, our latest consensus estimate expects the revenue to be $4 billion, showing a 7.39% escalation compared to the year-ago quarter.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $14.84 per share and revenue of $17.96 billion, indicating changes of +25.76% and +8.93%, respectively, compared to the previous year.
It is also important to note the recent changes to analyst estimates for Royal Caribbean. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.5% decrease. As of now, Royal Caribbean holds a Zacks Rank of #3 (Hold).
In terms of valuation, Royal Caribbean is currently trading at a Forward P/E ratio of 13.98. This expresses a discount compared to the average Forward P/E of 16.98 of its industry.
We can additionally observe that RCL currently boasts a PEG ratio of 0.71. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Leisure and Recreation Services industry had an average PEG ratio of 1.17 as trading concluded yesterday.
The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. With its current Zacks Industry Rank of 139, this industry ranks in the bottom 44% of all industries, numbering over 250.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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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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