Norwegian Cruise Line (NCLH) AI Stock Analysis

• Market Cap: $11.09B
• Dividend Yield: N/A
• Average Volume (3M): 14.66M
• Price to Earnings (P/E): 18.6
• Beta (1Y): 1.53
• Revenue Growth: 3.59%
• EPS Growth: 19.09%
• Country: US
• Employees: 41,700
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Travel Services
• EPS (TTM): 1.20
• Shares Outstanding: 455,257,480
• 10 Day Avg. Volume: 10,640,261
• 30 Day Avg. Volume: 14,658,081
• PEG Ratio: 0.03
• Price to Book (P/B): 7.86
• Price to Sales (P/S): 1.18
• P/FCF Ratio: 13.35
• Enterprise Value/Market Cap: 2.47
• Enterprise Value/Revenue: 2.83
• Enterprise Value/Gross Profit: 6.73
• Enterprise Value/Ebitda: 11.35
• 1Y Price Target: $26.77
• Price Target Upside: 9.85% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 67 Neutral
• Price Target: $26.00 ▲(6.69% Upside)

The score is driven primarily by improving operating performance and a strong earnings call (record results, raised EPS guidance, and record bookings). Offsetting factors are elevated balance-sheet leverage and negative free cash flow, while technicals show an uptrend but with overbought signals that reduce the technical contribution. Valuation is reasonable on P/E but lacks dividend support.

Positive Factors

Strong revenue recovery & margins

Sustained margin recovery and rapid revenue rebound indicate durable demand restoration and improved unit economics across brands. High gross margins provide cushioning against cost inflation and support reinvestment in product and service quality, aiding long-term competitive positioning.

Record bookings and high utilization

Consistently stronger bookings and above‑100% load factors signal robust forward revenue visibility and efficient fleet utilization. This enhances revenue predictability, supports pricing discipline over time, and helps spread fixed ship costs across more passengers, improving long‑run profitability.

Long-term renewable fuel partnership

A landmark renewable fuel supply deal reduces exposure to future regulatory constraints and carbon‑related costs, securing a stable fuel source. Such partnerships support compliance, ESG positioning, and potential operating cost predictability over multi‑year horizons, aiding strategic resilience.

Negative Factors

High leverage

Very high debt relative to equity limits financial flexibility in a capital‑intensive industry. Elevated leverage increases interest and refinancing vulnerability, constraining ability to invest in new ships or weather demand shocks without raising costly capital or diluting shareholders.

Negative free cash flow

Persistent negative free cash flow implies reliance on external financing to fund operations and capital expenditures. Over months, this hampers debt paydown and share repurchase flexibility, and increases refinancing and liquidity risk if demand or credit conditions deteriorate.

Pricing dilution and higher marketing spend

A structural mix shift toward lower‑yield third/fourth guests and elevated marketing investments can erode blended yields and margin expansion. If these mix and customer acquisition trends persist, sustained pressure on unit economics could limit margin upside despite robust demand levels.

Norwegian Cruise Line Business Overview & Revenue Model

Company Description

Norwegian Cruise Line Holdings Ltd., together with its subsidiaries, operates as a cruise company in North America, Europe, the Asia-Pacific, and internationally. The company operates the Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises brands. It offers itineraries ranging from three days to a 180-days calling on various locations, including destinations in Scandinavia, Russia, the Mediterranean, the Greek Isles, Alaska, Canada and New England, Hawaii, Asia, Tahiti and the South Pacific, Australia and New Zealand, Africa, India, South America, the Panama Canal, and the Caribbean. As of December 31, 2021, the company had 28 ships with approximately 59,150 berths. It distributes its products through retail/travel advisor and onboard cruise sales channels, as well as meetings, incentives, and charters. Norwegian Cruise Line Holdings Ltd. was founded in 1966 and is based in Miami, Florida.

How the Company Makes Money

Norwegian Cruise Line generates revenue primarily through ticket sales for its cruise voyages, which constitute the largest portion of its income. Additionally, the company earns significant income from onboard spending, including dining, beverages, excursions, and retail sales. NCLH also benefits from ancillary services such as travel insurance and pre- and post-cruise hotel accommodations. Partnerships with various travel agencies and online travel platforms further enhance its market reach and sales. The company may also engage in promotional activities and loyalty programs, encouraging repeat business and customer loyalty, which contribute to its overall earnings.

Norwegian Cruise Line Financial Statement Overview

Summary

Norwegian Cruise Line has shown strong revenue growth and profitability improvements post-pandemic, with a robust gross profit margin and positive net profit margin. However, high leverage and negative free cash flow remain significant concerns.

Income Statement

Norwegian Cruise Line has shown significant improvement in its income statement metrics over the years. The TTM data indicates a strong gross profit margin of 41.98% and a positive net profit margin of 6.85%, reflecting improved profitability. Revenue growth is robust at 137.6% TTM, indicating a strong recovery post-pandemic. However, the EBIT and EBITDA margins have decreased compared to the previous year, suggesting some operational challenges.

Balance Sheet

The balance sheet shows a high debt-to-equity ratio of 6.62 TTM, which is a concern for financial stability. Although there has been an improvement from previous years, the company remains highly leveraged. The return on equity is strong at 40.19% TTM, indicating effective use of equity to generate profits. However, the equity ratio remains low, reflecting potential risks in financial structure.

Cash Flow

Cash flow analysis shows mixed results. The operating cash flow to net income ratio is 0.38 TTM, indicating moderate cash generation relative to net income. Free cash flow has improved significantly, but remains negative, highlighting ongoing cash flow challenges. The free cash flow to net income ratio is negative, suggesting that the company is not yet generating sufficient free cash flow relative to its net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.69B	9.48B	8.55B	4.84B	647.99M	1.28B
Gross Profit	4.07B	3.79B	3.08B	576.67M	-960.05M	-413.15M
EBITDA	2.41B	2.49B	1.77B	-665.14M	-1.67B	-2.78B
Net Income	663.53M	910.26M	166.18M	-2.27B	-4.51B	-4.01B
Balance Sheet
Total Assets	22.21B	19.97B	19.49B	18.56B	18.73B	18.40B
Cash, Cash Equivalents and Short-Term Investments	166.80M	190.76M	402.42M	946.99M	1.75B	3.30B
Total Debt	15.35B	13.92B	14.06B	13.62B	12.45B	11.81B
Total Liabilities	20.02B	18.54B	19.19B	18.49B	16.30B	14.05B
Stockholders Equity	2.19B	1.43B	300.81M	68.59M	2.43B	4.35B
Cash Flow
Free Cash Flow	-1.04B	838.87M	-744.65M	-1.57B	-3.22B	-3.50B
Operating Cash Flow	2.03B	2.05B	2.01B	210.02M	-2.47B	-2.56B
Investing Cash Flow	-3.08B	-1.23B	-2.90B	-1.76B	-1.00B	-975.36M
Financing Cash Flow	879.65M	-1.03B	346.86M	986.22M	1.68B	6.58B

Norwegian Cruise Line Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 24.37
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NCLH, the sentiment is Positive. The current price of 24.37 is above the 20-day moving average (MA) of 22.43, above the 50-day MA of 20.43, and above the 200-day MA of 21.16, indicating a bullish trend. The MACD of 0.99 indicates Negative momentum. The RSI at 70.07 is Negative, neither overbought nor oversold. The STOCH value of 84.28 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NCLH.

Norwegian Cruise Line Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EXPE	80 Outperform	$36.31B	28.35	104.40%	0.56%	7.29%	36.51%
TCOM	71 Outperform	$50.45B	12.15	19.96%	0.39%	17.34%	91.51%
NCLH	67 Neutral	$11.09B	18.56	39.87%	―	3.59%	19.09%
RCL	67 Neutral	$82.99B	21.04	47.46%	1.09%	8.61%	49.58%
VIK	66 Neutral	$32.41B	33.95	9999.00%	―	20.04%	―
MMYT	65 Neutral	$7.85B	124.08	16.66%	―	14.55%	-68.46%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%