Norwegian Cruise Line Analysts Give Takeaways On Q3 Print, As The Stock Rebounds 38% In Past Month

Zinger Key Points
  • There are concerns around the sector outlook, one analyst said.
  • 2023 costs could be substantially higher than Street estimates, another analyst stated.

Norwegian Cruise Line Holdings Ltd NCLH on Tuesday reported third-quarter revenues ahead of street expectations.

Morgan Stanley On Norwegian Cruise Line

Analyst Jamie Rollo maintained an Equal Weight rating, with a price target of $13.

“3Q EBITDA was in-line with MSe, but missed consensus, on lower than expected opex, offset by slightly lower ticket pricing per PCD than we modelled,” Rollo said in a note.

“In 4Q the company reiterated its outlook of slightly positive adjusted EBITDA in second half of 2022, which is roughly in-line MSe/cons prior assumptions,” the analyst wrote. “3Q ticket pricing/onboard spending trends vs '19 remain robust but we remain cautious on sector outlook,” he added.

The analyst listed downside risks that include: 

  • Cruise demand structurally lower post COVID
  • Covid regulations restrict international cruising
  • Higher costs
  • Fuel prices increase

Check out other analyst stock ratings.

Credit Suisse On Norwegian Cruise Line

Analyst Benjamin Chaiken reaffirmed an Outperform rating, while lowering the price target from $25 to $20.

The company reported positive adjusted EBITDA for the first time since the beginning of the pandemic, Chaiken said. “We think the largest takeaway from the quarter is that costs in ’23 will be substantially higher than street estimates (and substantially higher than peers),” he added.

If the cost commentary is correct, it “places a significant amount of 'stress' on the ability of NCLH to drive yields,” the analyst further mentioned.

NCLH Price Action: Shares of Norwegian Cruise Line had fallen 4.80% to $16.45 at the time of publication on Wednesday.

Now Read: Travel Returns To Pre-Pandemic Levels, But Some Airlines, Other Industry-Related Companies Struggle

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Posted In: Analyst ColorEarningsNewsPrice TargetReiterationAnalyst RatingsMoversTrading IdeasBenjamin ChaikenCredit SuisseJamie RolloMorgan Stanley
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