Deutsche Bank upgrades Royal Caribbean to Buy
The bank maintained a $299 price target after the cruise line’s shares declined about 26% from August 5.
Deutsche Bank upgraded Royal Caribbean from Hold to Buy, while analyst Chris Woronka left his price target unchanged at $299. The move followed a roughly 26% decline in the cruise company’s shares since August 5.
Woronka said fuel expenses represented only about 7% of Royal Caribbean’s revenue at current prices. Caribbean cruise capacity, meanwhile, was expected to increase at a double-digit rate during the fourth quarter.
Royal Caribbean also announced plans to invest $3 billion in a joint venture that would hold a 50% stake in Sandals Resorts. The company’s price-to-sales ratio stood at 3.53, above its five-year median of 2.79.
Royal Caribbean had a GF Score of 87 out of 100, indicating stronger profitability and growth alongside comparatively weaker financial strength. Tracking data showed eight premium investment managers held the shares, with five recently reducing their positions and three increasing them.
