Royal Caribbean Cruises (NYSE:RCL) Shares Gap Up – Should You Buy?

Royal Caribbean Cruises Ltd. (NYSE:RCL)’s stock price gapped up prior to trading on Thursday . The stock had previously closed at $207.36, but opened at $214.91. Royal Caribbean Cruises shares last traded at $210.13, with a volume of 592,299 shares.

Wall Street Analyst Weigh In

A number of brokerages have recently commented on RCL. JPMorgan Chase & Co. increased their price target on shares of Royal Caribbean Cruises from $253.00 to $295.00 and gave the stock an “overweight” rating in a report on Friday, January 17th. Susquehanna cut their price target on shares of Royal Caribbean Cruises from $305.00 to $295.00 and set a “positive” rating on the stock in a report on Wednesday, March 5th. Sanford C. Bernstein assumed coverage on shares of Royal Caribbean Cruises in a report on Tuesday, November 26th. They issued an “outperform” rating and a $290.00 price target on the stock. Mizuho reissued an “outperform” rating and issued a $253.00 price target (down previously from $255.00) on shares of Royal Caribbean Cruises in a report on Thursday, January 23rd. Finally, StockNews.com raised shares of Royal Caribbean Cruises from a “sell” rating to a “hold” rating in a report on Tuesday, November 26th. Three investment analysts have rated the stock with a hold rating and fifteen have given a buy rating to the company. Based on data from MarketBeat, Royal Caribbean Cruises presently has an average rating of “Moderate Buy” and a consensus target price of $283.53.

Royal Caribbean Cruises Stock Performance

The business’s 50 day simple moving average is $242.06 and its two-hundred day simple moving average is $219.25. The firm has a market capitalization of $55.92 billion, a P/E ratio of 19.53, a price-to-earnings-growth ratio of 0.90 and a beta of 2.53. The company has a current ratio of 0.17, a quick ratio of 0.15 and a debt-to-equity ratio of 2.39.

Royal Caribbean Cruises (NYSE:RCL) last announced its quarterly earnings results on Tuesday, January 28th. The company reported $1.63 EPS for the quarter, topping analysts’ consensus estimates of $1.50 by $0.13. Royal Caribbean Cruises had a net margin of 17.46% and a return on equity of 48.97%. During the same period last year, the firm earned $1.25 earnings per share. Sell-side analysts anticipate that Royal Caribbean Cruises Ltd. will post 14.9 EPS for the current fiscal year.

Royal Caribbean Cruises Increases Dividend

The business also recently declared a quarterly dividend, which will be paid on Friday, April 4th. Stockholders of record on Friday, March 7th will be paid a $0.75 dividend. The ex-dividend date is Friday, March 7th. This is a positive change from Royal Caribbean Cruises’s previous quarterly dividend of $0.55. This represents a $3.00 dividend on an annualized basis and a dividend yield of 1.44%. Royal Caribbean Cruises’s payout ratio is currently 28.06%.

Royal Caribbean Cruises announced that its Board of Directors has initiated a stock repurchase plan on Wednesday, February 12th that allows the company to buyback $1.00 billion in shares. This buyback authorization allows the company to purchase up to 1.5% of its stock through open market purchases. Stock buyback plans are usually a sign that the company’s management believes its stock is undervalued.

Insider Activity at Royal Caribbean Cruises

In related news, CFO Naftali Holtz sold 17,000 shares of the business’s stock in a transaction that occurred on Tuesday, February 18th. The shares were sold at an average price of $261.62, for a total transaction of $4,447,540.00. Following the completion of the sale, the chief financial officer now directly owns 42,127 shares in the company, valued at approximately $11,021,265.74. The trade was a 28.75 % decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. Also, Director Richard D. Fain sold 19,500 shares of the business’s stock in a transaction that occurred on Thursday, February 13th. The shares were sold at an average price of $256.68, for a total transaction of $5,005,260.00. Following the sale, the director now owns 185,021 shares of the company’s stock, valued at $47,491,190.28. This trade represents a 9.53 % decrease in their ownership of the stock. The disclosure for this sale can be found here. Over the last ninety days, insiders sold 109,492 shares of company stock worth $28,571,705. 7.95% of the stock is owned by company insiders.

Hedge Funds Weigh In On Royal Caribbean Cruises

Several large investors have recently added to or reduced their stakes in the company. Capital International Investors lifted its holdings in Royal Caribbean Cruises by 0.9% during the fourth quarter. Capital International Investors now owns 29,712,610 shares of the company’s stock valued at $6,854,905,000 after purchasing an additional 278,860 shares in the last quarter. Vanguard Group Inc. lifted its holdings in Royal Caribbean Cruises by 8.0% during the fourth quarter. Vanguard Group Inc. now owns 28,072,316 shares of the company’s stock valued at $6,476,003,000 after purchasing an additional 2,068,114 shares in the last quarter. Geode Capital Management LLC lifted its holdings in Royal Caribbean Cruises by 6.3% during the fourth quarter. Geode Capital Management LLC now owns 5,969,532 shares of the company’s stock valued at $1,373,856,000 after purchasing an additional 353,893 shares in the last quarter. Norges Bank purchased a new position in Royal Caribbean Cruises during the fourth quarter valued at approximately $707,833,000. Finally, DZ BANK AG Deutsche Zentral Genossenschafts Bank Frankfurt am Main lifted its holdings in Royal Caribbean Cruises by 24.0% during the fourth quarter. DZ BANK AG Deutsche Zentral Genossenschafts Bank Frankfurt am Main now owns 2,653,258 shares of the company’s stock valued at $612,080,000 after purchasing an additional 513,702 shares in the last quarter. Hedge funds and other institutional investors own 87.53% of the company’s stock.

Royal Caribbean Cruises Company Profile

Royal Caribbean Cruises Ltd. operates as a cruise company worldwide. The company operates cruises under the Royal Caribbean International, Celebrity Cruises, and Silversea Cruises brands, which comprise a range of itineraries. As of February 21, 2024, it operated 65 ships. Royal Caribbean Cruises Ltd.