Norwegian Cruise's stock rises as profit outlook raised for 2nd time in 3 weeks

By Tomi Kilgore

Cruise operator is still seeing 'very strong demand' as it hosts its Investor Day

Shares of Norwegian Cruise Line Holdings Ltd. rallied Monday, after the cruise operator raised its full-year profit outlook, again, citing continued "very strong demand."

The update comes as the company lays out its three-year "Charting the Course" strategy at its investor day, which is geared at boosting shareholder returns.

The stock shot up 5.8% (NCLH) in morning trading, making it the S&P 500's SPX best performer.

The company said it now expects 2024 adjusted earnings per share of $1.42, which compares with the current FactSet consensus of $1.36.

"We have continued to see very strong demand and record bookings," said Chief Financial Officer Mark Kempa.

The raised outlook comes about three weeks after the company raised its full-year guidance to $1.32 from approximately $1.23 after the company reported first-quarter results.

Norwegian also raised its guidance for net yield to about 7.2% from approximately 6.4%, while it kept the outlook for capacity intact at 105.1%.

The stock had tumbled 15% on May 1 after the results disappointed investors as revenue rose less than expected. The stock had bounced around in a relatively narrow range since then, and had closed Friday 2.1% below where it closed on May 1.

On Monday, Norwegian also said it would discuss its new "Charting the Course" strategy. The strategy includes a "refreshed vision" and three-year financial targets, "geared at enhancing shareholder returns."

The company said one of its financial targets is to achieve adjusted EPS of $2.45 for 2026, which compares with the current 2026 FactSet EPS consensus of $2.22.

Even with Monday's rally, Norwegian's stock has been recently underperforming its peers. The stock has gained 3% over the past three months, while shares of Royal Caribbean Group (RCL) have soared 28.8% and Carnival Corp.'s stock (CCL) has advanced 6.8%. Meanwhile, the S&P 500 has gained 7% in the past three months.

-Tomi Kilgore

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05-20-24 1001ET

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