Royal Caribbean Cruises up after Deutsche Bank upgrades stock to 'buy'
RCL•Royal Caribbean shares rose about 1% in premarket trading after Deutsche Bank upgraded the stock to “buy” from “hold,” citing its 26% decline since August 5 and a more attractive risk/reward.
1. Upgrade rationale
Deutsche Bank attributed Royal Caribbean’s recent weakness to higher oil prices and investor concerns about the sustainability of yield growth, including Norwegian Cruise Line’s 2027 booking strategy and planned Caribbean capacity growth. The bank also said Royal Caribbean’s $3 billion investment in a joint venture for a 50% stake in Sandals Resorts has attractive economics, despite initial investor skepticism.
2. Analyst views
Deutsche Bank said a favorable reaction in Carnival shares after the company’s September 29 results could support Royal Caribbean. Twenty-two of 29 brokerages rate Royal Caribbean “buy” or higher, while seven rate it “hold”; the median price target is $346.50. The stock was down about 13% year to date through the prior day’s close.
