Investing in cruise lines does not exactly come with the widest array of choices. While there are dozens of cruising “brands” to choose from around the world, the reality is that there are a few holding companies that really control the world’s top cruise lines and huge ships. Citigroup has issued a report calling for significantly higher potential upside for strategic investors than the typical 8% to 12% upside calls you see in most research reports. The focus puts the most upside in the luxury cruise lines, but it’s really an “upside for all” research call in the cruise sector.
Citi analyst James Hardiman has performed pricing and demand trends using internet traffic and actual pricing analysis in this call for additional upside in the cruise leaders. The result is signaling sequential improvement from April to May after weakness was seen during April. Hardiman believes that price stability indicates that cruise operators are maintaining discipline while their ship capacity is largely booked through the rest of 2025.
Oggonomics always reminds is readers that no single analyst report should ever be the sole basis to buy or sell a stock. This is true for “Buy” ratings and “Sell” ratings alike. Analysts can get their thesis wrong just like the rest of us. And sometimes the market or a company’s fundamentals can change in the blink of an eye. And some investors may even take a contrarian view for long-term opportunities if the bulk of analysts have already downgraded the stocks.
Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH) was given the highest marks for potential upside if the analyst team’s projections pan out. Norwegian was reiterated as Buy and its price target was raised to $25 from $24 at Citigroup, implying 36% upside from its $18.39 prior close. Norwegian Cruise Line was seeing the biggest gain on the day with its shares up 6.7% at $19.63. Its 52-week range is $14.21 to $29.29.
Viking Holdings Ltd. (NYSE: VIK) was reiterated as Buy and its price target was raised to $57 from $52 at Citigroup, implying 21% upside from the prior $47.14 closing price. Citi had raised its target to $52 from $48 only about two weeks prior to this latest price target hike. This stock recently traded lower after earnings concerns and as private shareholders sold another 30.53 million shares at $44.20 in a secondary offering conducted by selling shareholders with no proceeds going to Viking Holdings itself. Its 52-week range is $29.83 to $53.14. While most cruise lines featured in this report are for large cruise ship operators, and while it does offer ocean and expedition cruises, Viking is best-known as a cruise line that caters to affluent river-cruise travelers in the 55+ age group.
Royal Caribbean Cruises Ltd. (NYSE: RCL) was reiterated as Buy and its price target was raised to $318 from $268 at Citigroup. This is implying a valuation up 20% from the prior $265.58 closing price without consideration of its 1.1% dividend. RCL also saw two fresh hikes in the prior days as well:
- Stifel (Buy) raised its target to $310 from $275 on June 4
- Loop Capital (Buy) raised its target to $290 from $250 on June 3
Carnival Corporation (NYSE: CCL) was reiterated as Buy and its price target was raised to $28 from $25 at Citigroup, implying 17% upside from the prior $23.81 closing price.
PLEASE NOTE: All analyst ratings and price targets mentioned above were issued by Citigroup in this summary. Their ratings and targets may differ greatly from other firms on Wall Street. Oggonomics does not issue any formal ratings and does not maintain any price targets of its own on these stocks. Also please remember that no analyst report, even those with very strong conviction, ever comes with any guarantees of profits and they never contain money-back guarantees in case you lose money.
