Royal Caribbean (RCL)
NYSE:RCL
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Royal Caribbean
(NYSE:RCL)
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Rating:67Neutral
Price Target:
$276.00
▼(-3.32% Downside)
Action:DowngradedDate:04/30/26
The score is driven by strong fundamentals and a supportive earnings outlook (high margins, solid operating cash generation, and reiterated growth/EPS guidance), tempered by meaningful leverage and only moderate free-cash-flow conversion. Technically, the stock’s weak momentum and trading below major moving averages is a notable near-term risk, while valuation appears reasonable but not a clear bargain.
Positive Factors
High operating margins
Sustained high operating and EBITDA margins indicate durable pricing power, strong onboard revenue mix, and effective cost control. These margins support cash generation across cycles, fund reinvestment in ships/destinations, and underpin above-average ROE even in capital-intensive cruising.
Negative Factors
Elevated leverage
Material absolute debt and 2.3x leverage constrain financial flexibility in a capital-intensive business. While improved from peak levels, the balance sheet remains sensitive to interest rates, slower demand, or cash flow disruption, limiting nimble capital allocation for several quarters.
Read all positive and negative factors
Positive Factors
Negative Factors
High operating margins
Sustained high operating and EBITDA margins indicate durable pricing power, strong onboard revenue mix, and effective cost control. These margins support cash generation across cycles, fund reinvestment in ships/destinations, and underpin above-average ROE even in capital-intensive cruising.
Read all positive factors
Royal Caribbean (RCL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$75.33B
Dividend Yield1.09%
Average Volume (3M)2.43M
Price to Earnings (P/E)19.7
Beta (1Y)1.53
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. Volume2,097,126
30 Day Avg. Volume2,433,834
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 Cap1.26
Enterprise Value/Revenue5.17
Enterprise Value/Gross Profit10.95
Enterprise Value/Ebitda13.33
Forecast
1Y Price Target
$337.31Price Target Upside18.16% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering16
EPS Forecast (FY)17.32
Revenue Forecast (FY)$19.62B
Royal Caribbean Business Overview & Revenue Model
Company Description
Royal Caribbean Cruises Ltd. operates as a cruise company worldwide. The company operates cruises under the Royal Caribbean International, Celebrity Cruises, Azamara, and Silversea Cruises brands, which comprise a range of itineraries that call on...
How the Company Makes Money
Royal Caribbean Group primarily makes money by selling cruise vacations and monetizing guest spending before and during a voyage. Its core revenue stream is passenger ticket revenue, which includes fares for cruise itineraries and associated charg...
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 Earnings Call Summary
Earnings Call Date:Apr 30, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 23, 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 | 7.13B | 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
Positive
285.48
Price Trends
292.00
Negative
287.65
Negative
300.87
Negative
Market Momentum
-1.84
Negative
53.01
Neutral
37.07
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RCL, the sentiment is Positive. The current price of 285.48 is above the 20-day moving average (MA) of 274.81, below the 50-day MA of 292.00, and below the 200-day MA of 300.87, indicating a neutral trend. The MACD of -1.84 indicates Negative momentum. The RSI at 53.01 is Neutral, neither overbought nor oversold. The STOCH value of 37.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
69 Neutral | $37.43B | 26.45 | 237.91% | ― | 21.89% | 697.07% | |
67 Neutral | $75.33B | 19.74 | 45.86% | 1.09% | 9.74% | 34.02% | |
64 Neutral | $37.35B | 42.16 | 26.22% | ― | 6.10% | 45.44% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $4.11B | 13.84 | -25.77% | 3.10% | 3.85% | -34.76% | |
56 Neutral | $1.39B | 40.09 | 12.24% | ― | 19.15% | 7.51% | |
52 Neutral | $7.91B | 20.40 | 27.04% | ― | 6.53% | -35.30% |
* Consumer Cyclical Sector Average
RCL
Royal Caribbean
280.87
50.99
22.18%
CCL
Carnival
27.00
6.90
34.35%
TNL
Travel + Leisure Co
65.91
19.89
43.22%
NCLH
Norwegian Cruise Line
17.22
-0.48
-2.71%
LIND
Lindblad Expeditions Holdings
21.15
10.71
102.59%
VIK
Viking Holdings
83.97
40.72
94.15%
Royal Caribbean Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Royal Caribbean Completes $2.5 Billion Senior Notes Offering
Positive
Feb 27, 2026
On February 27, 2026, Royal Caribbean Cruises Ltd. completed a $2.5 billion senior notes offering, issuing $1.25 billion of 4.750% notes due 2033 and $1.25 billion of 5.250% notes due 2038 under an existing indenture structure. The notes, register...
Business Operations and StrategyExecutive/Board Changes
Royal Caribbean Adds Marine Expert to Board of Directors
Positive
Feb 17, 2026
On February 10, 2026, Royal Caribbean Group appointed Christopher J. Wiernicki, former Chairman and CEO of American Bureau of Shipping, to its Board of Directors, with the move announced publicly on February 17, 2026. Wiernicki, a recognized marin...
Business Operations and StrategyPrivate Placements and Financing
Royal Caribbean Issues $2.5 Billion in Senior Notes
Positive
Feb 13, 2026
On February 12, 2026, Royal Caribbean Cruises Ltd. agreed to issue $2.5 billion of senior notes in an underwritten public offering, split between $1.25 billion of 4.750% notes due 2033 and $1.25 billion of 5.250% notes due 2038, with closing expec...
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.