Royal Caribbean Faces Q3 Booking Downside Despite Solid Q2 Outlook, UBS Says

MT Newswires Live07-02 23:00

Royal Caribbean (RCL) is on track for a solid Q2, but Q3 bookings face downside risk, while Perfect Day Mexico is delayed but still expected to proceed, UBS said in a note Thursday.

The analysts said the company is expected to report a fairly booked Q2, as its previous guidance likely did not account for a prolonged geopolitical conflict or its impact on bookings. They added that they continue to forecast flat Q3 yields in constant currency, compared with consensus expectations for nearly 1% growth, which they believe face downside risk.

Royal Caribbean has increased its reliance on European demand after March, but recent geopolitical uncertainty has impacted European bookings more heavily than in the past, the analysts said, adding that they maintain their 1.6% full-year yield forecast, which is below consensus and may not fully reflect the latest booking trends.

The analysts said the company's Perfect Day Mexico project is likely delayed to late 2027, with ramp-up in early 2028, but they believe it will still move forward.

UBS has a buy rating and a $309 price target on Royal Caribbean.

Price: 295.99, Change: -10.32, Percent Change: -3.37

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment