Royal Caribbean Extends Sailing Suspension Until November

Royal Caribbean Cruises has extended the suspension of cruise sailings until Nov. 30, excluding sailings from Hong Kong. The cruise operator has taken the decision due to the COVID-19 crisis, which has dented the demand for voyages.

Royal Caribbean (RCL) said that its cruise brand Celebrity Cruises will suspend the full 2020/21 winter program in Australia and Asia. Its Azamara cruises will also cancel their 2020/21 winter sailings throughout Australia & New Zealand, South Africa and South America.

On Aug. 10, the company reported 2Q loss of $6.13 per share, which was larger than analysts’ loss expectations of $4.82. The 2Q revenues of $175.6 million, however, surpassed the Street consensus of $43.5 million. (See RCL stock analysis on TipRanks)

On Sept. 25, Barclays analyst Felicia Hendrix upgraded the stock to Buy from Hold, saying that risk/rewards in the cruise space are very attractive in the U.S. leisure sector. She maintained a price target of $68 (2.8% upside potential).

Currently, the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 7 Buys, 5 Holds and 2 Sells. The average price target of $58.08 implies downside potential of about 12.2% to current levels. Shares have declined by about 50.4% year-to-date.

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