Norwegian Cruise Line (NCLH) AI Stock Analysis

• Market Cap: $11.40B
• Dividend Yield: N/A
• Average Volume (3M): 15.40M
• Price to Earnings (P/E): 18.2
• Beta (1Y): 1.59
• Revenue Growth: 5.23%
• EPS Growth: 66.94%
• Country: US
• Employees: 41,700
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Travel Services
• EPS (TTM): 0.51
• Shares Outstanding: 451,937,070
• 10 Day Avg. Volume: 15,021,831
• 30 Day Avg. Volume: 15,402,727
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 2.06
• Enterprise Value/Revenue: 2.46
• Enterprise Value/Gross Profit: 5.94
• Enterprise Value/Ebitda: 10.23
• 1Y Price Target: $30.73
• Price Target Upside: 22.92% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 15

• Rating: 70 Outperform
• Price Target: $27.00 ▲(8.00% Upside)

Norwegian Cruise Line's overall stock score reflects strong earnings performance and positive technical indicators, offset by high leverage and capital expenditure challenges. The optimistic outlook from the earnings call further supports the stock's potential for growth.

Positive Factors

Revenue Growth

The record-breaking revenue growth indicates strong market demand and effective pricing strategies, ensuring sustained financial performance and market competitiveness.

Strategic Expansion

Strategic expansions and new developments enhance customer experience and market presence, driving future demand and supporting long-term growth.

Deleveraging

Reducing leverage improves financial stability and flexibility, enabling the company to invest in growth opportunities while mitigating financial risks.

Negative Factors

High Leverage

High leverage can strain financial resources and limit strategic options, potentially impacting the company's ability to navigate economic downturns.

Negative Free Cash Flow

Negative free cash flow indicates potential liquidity challenges, as capital expenditures outpace cash generation, affecting short-term financial health.

Occupancy Challenges

Lower occupancy rates, particularly in long-haul European sailings, suggest potential demand issues, impacting revenue and profitability in key markets.

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 from cruise bookings and ancillary services provided to passengers. The main revenue streams include cruise ticket sales, which contribute the largest portion of income, alongside onboard spending such as dining, beverage packages, shore excursions, and spa services. Additionally, NCLH earns revenue from its vacation packages and land-based offerings, which can include pre- and post-cruise hotel stays, ground transportation, and tours. The company also benefits from partnerships with travel agencies and online travel platforms that help promote and sell its cruise packages. Seasonal promotions and marketing campaigns further enhance bookings and onboard spending, contributing to overall revenue growth.

Norwegian Cruise Line Financial Statement Overview

Summary

Norwegian Cruise Line's financial performance shows a strong recovery in revenue and profitability, with improved margins. However, high leverage and negative free cash flow due to capital expenditures pose financial risks.

Income Statement

The income statement shows a strong recovery with a substantial increase in total revenue and gross profit in the TTM (Trailing-Twelve-Months) compared to previous periods. The gross profit margin improved to 41.36%, and the net profit margin increased to 7.52%. However, the revenue growth rate from the previous year was modest at 0.86%. The EBIT margin also improved to 16.01%, indicating better operational efficiency, though EBITDA margin declined slightly due to higher depreciation and amortization expenses. Overall, the income statement reflects significant recovery and profitability improvement, though growth rates remain moderate.

Balance Sheet

The balance sheet shows high leverage with a debt-to-equity ratio of 8.77, indicating significant financial risk. Stockholders' equity is low relative to total assets, resulting in an equity ratio of 7.27%. The return on equity (ROE) is robust at 45.81%, highlighting efficient use of equity to generate profits. While debt levels are concerning, the high ROE and improved equity position hint at potential future stability if leveraged effectively.

Cash Flow

Cash flow analysis shows a decline in free cash flow due to increased capital expenditures, leading to a negative free cash flow. The operating cash flow to net income ratio is healthy at 2.73, indicating strong cash generation relative to net income. However, the free cash flow to net income ratio is negative, reflecting significant capital investments. While the company demonstrates strong operational cash flow, the need for substantial capital investment poses a challenge to liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	9.56B	9.48B	8.55B	4.84B	647.99M	1.28B
Gross Profit	3.95B	3.79B	3.08B	576.67M	-960.05M	-413.15M
EBITDA	2.30B	2.49B	1.77B	-665.14M	-1.67B	-2.78B
Net Income	719.16M	910.26M	166.18M	-2.27B	-4.51B	-4.01B
Balance Sheet
Total Assets	21.60B	19.97B	19.49B	18.56B	18.73B	18.40B
Cash, Cash Equivalents and Short-Term Investments	184.01M	190.76M	402.42M	946.99M	1.75B	3.30B
Total Debt	13.76B	13.10B	14.06B	13.62B	12.45B	11.81B
Total Liabilities	20.03B	18.54B	19.19B	18.49B	16.30B	14.05B
Stockholders Equity	1.57B	1.43B	300.81M	68.59M	2.43B	4.35B
Cash Flow
Free Cash Flow	-504.48M	838.87M	-744.65M	-1.57B	-3.22B	-3.50B
Operating Cash Flow	1.97B	2.05B	2.01B	210.02M	-2.47B	-2.56B
Investing Cash Flow	-2.48B	-1.23B	-2.90B	-1.76B	-1.00B	-975.36M
Financing Cash Flow	100.66M	-1.03B	346.86M	986.22M	1.68B	6.58B

Norwegian Cruise Line Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 25.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NCLH, the sentiment is Neutral. The current price of 25 is below the 20-day moving average (MA) of 25.46, above the 50-day MA of 24.72, and above the 200-day MA of 22.41, indicating a neutral trend. The MACD of 0.23 indicates Positive momentum. The RSI at 48.71 is Neutral, neither overbought nor oversold. The STOCH value of 22.08 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NCLH.

Norwegian Cruise Line Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ABNB	76 Outperform	76.49B	29.37	33.73%	―	10.23%	-44.56%
RCL	74 Outperform	88.83B	24.65	39.30%	0.94%	12.10%	37.89%
TCOM	73 Outperform	51.24B	21.18	11.97%	0.37%	17.73%	27.95%
EXPE	72 Outperform	26.95B	26.65	133.13%	0.56%	5.69%	47.33%
NCLH	70 Outperform	$11.40B	18.16	63.57%	―	5.23%	66.94%
MMYT	66 Neutral	9.25B	108.60	7.91%	―	18.13%	-55.21%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Norwegian Cruise Line Corporate Events

Norwegian Cruise Line Announces Cash Tender Offer

On September 8, 2025, NCL Corporation Ltd., a subsidiary of Norwegian Cruise Line Holdings Ltd., announced a cash tender offer to repurchase its outstanding senior secured notes due 2027 and senior notes due 2026. Concurrently, the company commenced a registered direct offering of its ordinary shares and proposed private offerings of senior notes due 2031 and 2033, and exchangeable senior notes due 2030. The proceeds from these offerings will be used to fund the tender offer, redeem existing notes, and pay related expenses, positioning the company to manage its debt effectively.

Norwegian Cruise Line Announces Leadership Change

On August 20, 2025, David Herrera, the President of Norwegian Cruise Line, departed the company as part of a strategic leadership change. Harry Sommer, the President and CEO, will temporarily take over Herrera’s responsibilities while a search for a successor is conducted. Despite this leadership change, the company remains committed to its 2026 financial targets, with its 2025 guidance unchanged from the second quarter earnings release.

Norwegian Cruise Line Announces Great Stirrup Cay Expansion

On July 29, 2025, Norwegian Cruise Line Holdings Ltd. announced the second phase of expansion plans for Great Stirrup Cay, its private island in the Bahamas. This phase includes the development of Great Tides Waterpark, featuring a dynamic river and a kids splash zone, expected to open in the summer of 2026. This expansion is part of a broader enhancement plan that also includes a two-ship pier and other amenities, set to open by the end of 2025, potentially enhancing the company’s market positioning and customer offerings.

Norwegian Cruise Line Secures Financing for New Vessels

On July 17, 2025, NCL Corporation Ltd., a subsidiary of Norwegian Cruise Line Holdings Ltd., entered into credit facility agreements to finance two new cruise vessels, with deliveries expected in 2030 and 2032. The financing, insured by SACE, aims to cover 80% of the delivery payments, with loans bearing a fixed interest rate and secured by ship mortgages, reflecting strategic expansion plans in the cruise industry.

Norwegian Cruise Line Amends Credit Agreement June 2025

On June 26, 2025, NCL Corporation Ltd., a subsidiary of Norwegian Cruise Line Holdings Ltd., amended its Seventh Amended and Restated Credit Agreement, increasing its revolving loan facility from $1.7 billion to $2.486 billion, with maturity conditions extending to January 22, 2030. Additionally, a Second Supplemental Indenture was executed to secure NCLC’s 2029 Secured Notes with the same collateral as the revolving loan facility, aligning guarantees and collateral across financial obligations.

Norwegian Cruise Line Holds Annual Shareholder Meeting

On June 12, 2025, Norwegian Cruise Line Holdings Ltd. held its annual general meeting of shareholders in Miami, Florida, where four key proposals were voted on. Shareholders elected three directors to serve until 2028, approved executive compensation on a non-binding basis, amended the 2013 Performance Incentive Plan to increase available shares, and ratified PricewaterhouseCoopers LLP as the independent registered public accounting firm for 2025.