- RCL stock falls on the release of earnings for Q1.
- RCL share price misses on top and bottom lines.
- Royal Caribbean Cruises hoping to be up to full capacity by summer 2022.
Royal Caribbean (RCL) is sailing into choppy waters after the release of Q1 earnings. The cruise operator missed on both top and bottom lines and RCL stock is trading 2% lower on Thursday in the premarket.
Read more stock market research
Royal Caribbean (RCL) stock news: Full fleet expected by summer 2022
Royal Caribbean reported Q1 earnings per share (EPS) of $-4.57 when Wall Street was looking for $-4.47. Revenue also missed coming in at $1.06 billion versus the $1.15 billion estimate. So far, we do not have much color on the earnings as the conference call is not due to get underway until 14 GMT (10 am EST). The link for the conference call can be found here.
Royal Caribbean did say that bookings for 2022 have surpassed the record levels seen in 2019. RCL expects by the summer of 2022 to be back to a full fleet of sailings and full schedule as before the pandemic. RCL said it expects to return to profitability in the second half of 2022. Royal Caribbean has hedged 55% of fuel costs for 2022 and 25% for 2023.
Royal Caribbean (RCL) stock forecast: Rising debt caps bullish action
The problem for RCL stock is twofold, and both factors are outside its control. Firstly, it has a lot of debt that will need refinancing. Higher interest rates mean higher costs. Secondly, fuel costs as alluded to above. 25% hedged for 2023 is not comforting.
In rising yield environments, debt loads weigh on balance sheets and cash flow. Rising inflation hits consumer demand at the top end of the market and cruising is the top end. Pent-up demand will likely see RCL through this year but next summer 2023 expect demand to be hit as consumers pull back.
There is nothing too significant in terms of the RCL stock chart. Choppy is a bit of an obvious pun but applicable.
RCL stock chart, daily
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD struggles near multi-month low; looks to US CPI for fresh impetus
AUD/USD languishes near a multi-month low during the Asian session on Wednesday and seems vulnerable amid a bullish USD. Expectations that inflationary import tariffs from US President-elect Donald Trump will push up prices and limit the scope for the Fed to cut rates remain supportive of elevated US bond yields.
USD/JPY sits near its highest level since July, close to 155.00 as traders await US CPI
USD/JPY stands firm near its highest level since July 30 amid speculations that a fragile minority government in Japan will make it difficult for the BoJ to tighten its monetary policy further. Moreover, fears that US President-elect Donald Trump might again hit Japan with protectionist trade measures continue to undermine the JPY.
Gold price oscillates around $2,600, just above a nearly two-month low ahead of US inflation
Gold price consolidates its recent heavy losses to the lowest level since September 20 as bears opt to pause for a breather ahead of the crucial US CPI report, which will influence Fed rate-cut expectations and provide a fresh impetus.
Ripple could rally 50% following renewed investor interest
Ripple's XRP rallied nearly 20% on Tuesday, defying the correction seen in Bitcoin and Ethereum as investors seem to be flocking toward the remittance-based token. XRP could rally nearly 50% if it sustains a firm close above the neckline resistance of an inverted head and shoulders pattern.
Five fundamentals: Fallout from the US election, inflation, and a timely speech from Powell stand out Premium
What a week – the US election lived up to their hype, at least when it comes to market volatility. There is no time to rest, with politics, geopolitics, and economic data promising more volatility ahead.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.