Royal Caribbean (RCL) may begin 2027 guidance more conservatively than UBS' 3% yield growth estimate due to geopolitical headwinds, the bank said in a note emailed Wednesday.
Net yield growth for 2027 is expected to be weighted toward H2, as Q1 yields face 200 basis points of structural headwinds, including the timing of drydock days and head taxes, UBS said. These factors are expected to be roughly neutral for the full year, with head taxes becoming neutral by the end of 2027, the note added.
UBS expects Sandals to contribute to RCL's joint venture line next year an amount equivalent to roughly half of the $414 million TUI Cruises contributed to equity investment income in 2025.
UBS kept a buy rating on Royal Caribbean with a price target of $367.
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