Cruise vacation company Royal Caribbean (NYSE:RCL) will be reporting earnings tomorrow before the bell. Here’s what to look for.
Royal Caribbean met analysts’ revenue expectations last quarter, reporting revenues of $4.89 billion, up 17.4% year on year. It was a mixed quarter for the company, with a decent beat of analysts’ adjusted operating income estimates but EPS guidance for next quarter missing analysts’ expectations. It reported 14.79 million passenger cruise days, up 12.3% year on year.
Is Royal Caribbean a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Royal Caribbean’s revenue to grow 13.2% year on year to $3.77 billion, slowing from the 27.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.50 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Royal Caribbean has missed Wall Street’s revenue estimates three times over the last two years.
Looking at Royal Caribbean’s peers in the travel and vacation providers segment, some have already reported their Q4 results, giving us a hint as to what we can expect. American Airlines delivered year-on-year revenue growth of 4.6%, beating analysts’ expectations by 1.8%, and Carnival reported revenues up 10%, in line with consensus estimates. American Airlines traded down 9.2% following the results while Carnival was up 2.2%.
Read our full analysis of American Airlines’s results here and Carnival’s results here.
There has been positive sentiment among investors in the travel and vacation providers segment, with share prices up 3.8% on average over the last month. Royal Caribbean’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $253.61 (compared to the current share price of $228.71).
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