Carnival, Royal Caribbean, and Norwegian Cruise Line All Surged Today

Carnival, Royal Caribbean, and Norwegian Cruise Line All Surged Today

Carnival, Royal Caribbean, and Norwegian Cruise Line All Surged Today what happened shares of carnival in yse ccl in yse cuk royal caribbean in yse rcl and norwegian cruise line holdings in yse nclh all surged on friday with the stocks up 5.1 percent 4.7 percent and 5.3 percent respectively as of 107 pm eastern time crew stock searched after stifle analyst stephen weichzinski declared 2022 was going to be the year of the cruise no wonder the three top publicly traded crew stocks searched on the back of that declaration
so what for those who found the title of the analyst note exciting the thesis may be a little bit of a let down which zinsky basically sees 2022 cruise demand remaining strong as most industry executives have already stated in recent analyst and media appearances but with the delayed economic reopening thanks to the delta variant this summer and then armacron in november december crew stocks came under pressure toward the end of 2021 giving back some gains from earlier in the year given that cruises massively underperformed versus other reopening stocks last year which zinsky likes the setup for crew stocks as top choices for investors playing the continued reopening in 2022 while he believes the ongoing armacrone surge may cause some delays or noise around getting back to full speed cruise lines should get back to somewhat normal operations through 2022 and eventually approach cash flow breakeven he says specifically which zinski named royal caribbean as his top pick for the year now what posting positive revenue growth and fewer net losses would certainly be good for these cruise names in 2022 so i wouldn’t be surprised to see them getting back toward their previous 52 week highs each of these stocks is down between 20 and 33 percent from those levels so that could offer significant near-term upside versus other sectors that may be more fully priced that’s of course as long as there are no new variants a big if still i have a hard time recommending these names as compelling long-term investments beyond this near-term delayed reopening trade all these companies took on massive amounts of debt diluted their shareholders with equity offerings and disposed of less efficient ships to get through the pandemic so even when they rebound to normal i wouldn’t expect blockbuster results relative to 2019. so while these stocks could very well rally in 2022 they may struggle to get back to all-time highs that are generally 100 or more higher than their current stock prices while they may be decent short-term trades given the uncertainty around the virus and their highly indebted balance sheets these stocks are still somewhat risky and aren’t terribly compelling long-term investments in my opinion.

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