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Royal Caribbean
(NYSE:RCL)
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Rating:69Neutral
Price Target:
$348.00
▲(21.90% Upside)
Action:Reiterated
Date:05/29/26
The score is driven primarily by strong operating performance and margin recovery, supported by positive full-year guidance and solid operating cash generation. It is held back by meaningful leverage and only moderate free-cash-flow conversion, plus a mixed technical picture (negative MACD and below longer-term moving averages) and a negative regulatory setback related to Mexico permits.
Positive Factors
Margin Recovery & Profitability
Royal Caribbean has re-established high operating profitability since the downturn, with TTM operating margins near 30% and EBITDA margins around 39%. Sustained margins provide durable cash generation, support reinvestment in fleet and experiences, and enhance resilience to cyclical demand shifts.
Negative Factors
High Absolute Leverage
Despite improvement from peak levels, sizeable absolute debt (~$21.8B) and meaningful leverage limit financial flexibility. Elevated liabilities increase interest-rate and refinancing risk, reduce shock absorption during demand weakness, and constrain capacity for opportunistic investment or faster buybacks.
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Positive Factors
Negative Factors
Margin Recovery & Profitability
Royal Caribbean has re-established high operating profitability since the downturn, with TTM operating margins near 30% and EBITDA margins around 39%. Sustained margins provide durable cash generation, support reinvestment in fleet and experiences, and enhance resilience to cyclical demand shifts.
Read all positive factors
Royal Caribbean Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks revenue into ticket fares, onboard spending, shore excursions, and other streams, showing which businesses drive growth and margins. Useful for spotting diversification, high-margin engines, and where top-line volatility may come from.
Breaks revenue into ticket fares, onboard spending, shore excursions, and other streams, showing which businesses drive growth and margins. Useful for spotting diversification, high-margin engines, and where top-line volatility may come from.
Data provided by:
The Fly
The FlyRoyal Caribbean (RCL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$75.35B
Dividend Yield1.09%
Average Volume (3M)2.62M
Price to Earnings (P/E)17.4
Beta (1Y)1.54
Revenue Growth9.74%
EPS Growth34.02%
CountryUS
Employees105,950
SectorConsumer Cyclical
Sector Strength84
IndustryTravel Services
Share Statistics
EPS (TTM)16.51
Shares Outstanding268,194,980
10 Day Avg. Volume2,443,582
30 Day Avg. Volume2,618,370
Financial Highlights & Ratios
PEG Ratio0.41
Price to Book (P/B)7.53
Price to Sales (P/S)4.21
P/FCF Ratio61.15
Enterprise Value/Market Cap1.36
Enterprise Value/Revenue5.55
Enterprise Value/Gross Profit11.76
Enterprise Value/Ebitda14.13
Forecast
1Y Price Target
$333.00Price Target Upside16.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering20
EPS Forecast (FY)17.36
Revenue Forecast (FY)$19.59B
Royal Caribbean Business Overview & Revenue Model
Company Description
Royal Caribbean Cruises Ltd. is a prominent global operator within the cruise sector. The company manages several well-known cruise lines, such as Royal Caribbean International, Celebrity Cruises, Azamara, and Silversea Cruises. Through these bran...
How the Company Makes Money
Royal Caribbean Group primarily makes money by selling cruise vacations and related travel products. Its core revenue stream is passenger ticket revenue (often called passenger cruise revenue), which includes fares paid for the cruise itinerary an...
Royal Caribbean Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 28, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: strong Q1 results (11% revenue growth, adjusted EPS beat, higher EBITDA margins and cash generation), record demand and digital engagement, active capital returns and continued strategic investments (new ships, destinations, loyalty, and tech/AI). Near-term headwinds include higher fuel costs (~$0.62/shr fuel impact, ~$0.74 total with JV impact), moderation in Mediterranean and West Coast Mexico bookings affecting Q2/Q3 yields, and some incremental dry-dock and crew travel cost pressure. Management expects these issues to be largely near-term and reiterated double-digit revenue and EPS growth for 2026, supported by a strong balance sheet and robust booking trends, so positive operational momentum outweighs the highlighted challenges.Positive Updates
Revenue and Earnings Beat
Revenue grew 11% year-over-year in Q1 and adjusted EPS was $3.60, $0.37 above the midpoint of guidance and up 33% versus prior year; Q1 adjusted EPS outperformance driven by better-than-expected revenue, lower costs and stronger JV performance.
Negative Updates
Fuel Cost Headwind
Higher fuel prices are a material headwind to 2026 results: company expects fuel expense of $1.35 billion for the year, is ~60% hedged for 2026, and guidance includes a ~$0.62 per share headwind from fuel for the remainder of the year (total $0.74 per share headwind when combined with lower JV contribution).
Read all updates
Q1-2026 Updates
Positive
Negative
Revenue and Earnings Beat
Revenue grew 11% year-over-year in Q1 and adjusted EPS was $3.60, $0.37 above the midpoint of guidance and up 33% versus prior year; Q1 adjusted EPS outperformance driven by better-than-expected revenue, lower costs and stronger JV performance.
Read all positive updates
Company Guidance
Royal Caribbean guided to another year of strong growth, forecasting full‑year revenue up roughly double digits with capacity +6.7% and net yield growth of +1.5% to +2.5%; full‑year adjusted EPS of $17.10–$17.50 (double‑digit EPS growth) which reflects a combined $0.74 headwind (≈$0.62 from higher fuel and $0.12 from lower TUI Cruises contribution). They expect fuel expense of about $1.35 billion with roughly 59–60% of remaining 2026 consumption hedged (fuel would be ≈4% lower on the forward curve), full‑year net cruise costs ex‑fuel roughly flat (about 50 bps better than prior guidance), and a continued focus on margin and cash‑flow expansion via the Perfecta targets (20% CAGR in adjusted EPS through 2027 and high‑teens ROIC). For Q2 specifically, capacity is guided +4.9%, net yield ≈+0.2% cc, net cruise costs ex‑fuel +4.6%–5.1% cc, and adjusted EPS $3.83–$3.93 (quarter hit by nearly $1 of phasing/headwinds).Royal Caribbean Financial Statement Overview
Summary
Income Statement
86
Very Positive
Balance Sheet
62
Positive
Cash Flow
70
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 18.39B | 17.93B | 16.48B | 13.90B | 8.84B | 1.53B |
| Gross Profit | 8.68B | 8.40B | 7.83B | 6.13B | 2.22B | -1.21B |
| EBITDA | 7.23B | 6.91B | 6.09B | 4.56B | 615.00M | -2.67B |
| Net Income | 4.48B | 4.27B | 2.88B | 1.70B | -2.16B | -5.26B |
Balance Sheet | ||||||
| Total Assets | 41.99B | 41.62B | 37.07B | 35.13B | 33.78B | 32.26B |
| Cash, Cash Equivalents and Short-Term Investments | 512.00M | 940.00M | 388.00M | 497.00M | 1.94B | 2.70B |
| Total Debt | 21.79B | 22.64B | 20.82B | 22.13B | 23.99B | 21.69B |
| Total Liabilities | 31.96B | 31.37B | 29.34B | 30.23B | 30.91B | 27.17B |
| Stockholders Equity | 9.81B | 10.04B | 7.56B | 4.72B | 2.87B | 5.09B |
Cash Flow | ||||||
| Free Cash Flow | 1.37B | 1.24B | 2.00B | 580.00M | -2.23B | -4.11B |
| Operating Cash Flow | 6.67B | 6.46B | 5.26B | 4.48B | 481.00M | -1.88B |
| Investing Cash Flow | -5.10B | -5.01B | -3.45B | -3.92B | -2.99B | -2.15B |
| Financing Cash Flow | -1.44B | -1.02B | -1.92B | -1.99B | 1.74B | 3.04B |
Royal Caribbean Technical Analysis
Neutral
285.48
Price Trends
282.17
Positive
282.15
Positive
285.52
Positive
Market Momentum
1.58
Positive
46.22
Neutral
11.48
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCL, the sentiment is Neutral. The current price of 285.48 is below the 20-day moving average (MA) of 302.64, above the 50-day MA of 282.17, and below the 200-day MA of 285.52, indicating a neutral trend. The MACD of 1.58 indicates Positive momentum. The RSI at 46.22 is Neutral, neither overbought nor oversold. The STOCH value of 11.48 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RCL.
Royal Caribbean Risk Analysis
Royal Caribbean disclosed 36 risk factors in its most recent earnings report. Royal Caribbean reported the most risks in the "Macro & Political" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Royal Caribbean Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $43.71B | 37.35 | 148.16% | ― | 20.78% | 119.41% | |
71 Outperform | $35.12B | 11.57 | 26.22% | ― | 5.16% | 16.93% | |
69 Neutral | $75.35B | 17.45 | 45.86% | 1.09% | 9.74% | 34.02% | |
62 Neutral | $1.68B | -49.24 | 11.75% | ― | 19.15% | 7.51% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
58 Neutral | $4.54B | 20.48 | -25.77% | 3.10% | 3.85% | -34.76% | |
58 Neutral | $8.48B | 15.72 | 27.04% | ― | 6.53% | -35.30% |
* Consumer Cyclical Sector Average
RCL
Royal Caribbean
285.37
-47.45
-14.26%
CCL
Carnival
26.83
-1.52
-5.37%
TNL
Travel + Leisure Co
74.25
18.88
34.09%
NCLH
Norwegian Cruise Line
19.61
-3.01
-13.31%
LIND
Lindblad Expeditions Holdings
26.52
13.66
106.22%
VIK
Viking Holdings
99.14
42.69
75.62%
Royal Caribbean Corporate Events
Executive/Board ChangesShareholder Meetings
Royal Caribbean Shareholders Back Board, Pay and Auditor
Positive
May 28, 2026
At its annual meeting held on May 28, 2026, Royal Caribbean shareholders elected all 13 director nominees to the board, each securing a majority of votes cast, reinforcing continuity in the company’s leadership and governance. Shareholders a...
Business Operations and StrategyRegulatory Filings and Compliance
Royal Caribbean Faces Setback on Mexico Destination Permits
Negative
May 20, 2026
On May 19, 2026, Mexico’s environmental authority SEMARNAT indicated it would deny Royal Caribbean’s initial application for environmental permits for its planned Perfect Day Mexico destination, a setback for the cruise operator’...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.