Skip to main content

Market Overview

Analyst: Here's How Long Carnival, Norwegian And Royal Caribbean Can Last Without Revenue

Analyst: Here's How Long Carnival, Norwegian And Royal Caribbean Can Last Without Revenue

With business at a standstill and revenue dry, companies are dipping into cash reserves to cover costs. Few seem to be hurting worse than cruises are.

The Cruise Ratings

Bank of America analysts Andrew Didora and Geoffrey d’Halluin maintained:

  • A Neutral rating on Carnival Corp (NYSE: CCL) but raised their price target from $10 to $13;
  • A Neutral rating on Norwegian Cruise Line Holdings Ltd (NYSE: NCLH) with a $13 target; and
  • An Underperform rating on Royal Caribbean Cruises Ltd (NYSE: RCL) with a $20 target.

Carnival: 9 Months

Carnival recently suggested it requires $1 billion in liquidity per month to cover operating expenditures, customer refunds, debt obligations and other necessities. At this rate, with debt and equity offerings completed in April, Didora's suspect that Carnival can sustain itself through the end of 2020.

“We believe CCL could be able to reduce its monthly cash burn predominantly given potential delays in ship investments and potential debt maturities holidays, which could extend its liquidity into 2021,” they wrote in a note.

Norwegian: 18 Months

Norwegian Cruise Line is paying between $70 million and $110 million each month for debt obligations, opex and capex. The analysts also anticipate about $67 million per month in refund payouts for the rest of the year.

The company recently raised $2.4 billion in capital, which bolstered its liquidity position to about $3.8 billion, according to Bank of America estimates. This “is enough to get through at least 4Q21 in a worst case of no future cash sales,” they wrote.

Royal Caribbean: 11 Months

According to Didora's estimates, Royal Caribbean has about $3.45 billion in liquidity but is burning about $330 million in cash per month. At that rate, the company can last through the first quarter of 2021 with suspended operations.

“For RCL to extend its liquidity into late 2021 to further de-risk its liquidity profile, we estimate it would need to raise an incremental $1.5-2.0B in capital,” the analysts wrote.

Price Action

At time of publication, Royal Caribbean traded down 1.4% around $34.66, Carnival down marginally around $12.20, and Norwegian down 2.1% around $10.53.

Related Links:

Here's How Much Investing $100 In Carnival Stock Back In 2010 Would Be Worth Today

Cruise Line Analyst Jumps Ship On Norwegian Cruise, Royal Caribbean Amid Coronavirus Cancellations

Latest Ratings for CCL

Apr 2021Morgan StanleyMaintainsUnderweight
Apr 2021Goldman SachsMaintainsNeutral
Apr 2021Argus ResearchUpgradesHoldBuy

View More Analyst Ratings for CCL
View the Latest Analyst Ratings


Related Articles (CCL + NCLH)

View Comments and Join the Discussion!

Posted-In: Andrew Didora Bank of AmericaAnalyst Color Price Target Reiteration Travel Analyst Ratings General Best of Benzinga

Latest Ratings

SVLake StreetInitiates Coverage On20.0
CLSDJMP SecuritiesMaintains9.0
WPCJP MorganUpgrades88.0
BRKRCleveland ResearchUpgrades
NTRRaymond JamesDowngrades82.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at