RCL
Royal Caribbean Cruises Ltd.$283.06
Sell
Target $232.30
Report: Mar 07, 2026Consumer Cyclical • Travel Services • Cyclical OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$283.06-17.9%
Rec: SellConviction: High
Entry Target
N/A
N/A
Fair Value
$232.30
(18% below current)
Stop Loss
N/A
N/A
Position Size
None
Time Horizon
N/A
Key Metrics
Live Snapshot
Market Data
52 Week High$366.50
52 Week Low$164.01
Avg. 3 Month Volume2.49M
Efficiency
LTM Gross Margin49.4%
LTM EBITDA Margin39.4%
LTM EBIT Margin29.8%
LTM Operating Margin27.4%
LTM ROA10.8%
LTM ROE45.8%
LTM ROIC11.2%
LTM ROCE19.0%
Capital Structure
Market Cap (MM)$74.4B
Enterprise Value (MM)$95.7B
Shares Outstanding270.53M
Total Debt (MM)$22.04B
Cash & Equivalents (MM)$825.00M
LTM Net Debt (MM)$21.21B
LTM Net Debt/EBITDA3.0x
Growth
TTM Rev. Growth8.8%
Last 3-Yr Rev. CAGR26.6%
Last 3-Yr EBITDA CAGR125.6%
Last 3-Yr EPS CAGRN/A
Valuation
Street Target Price$367.50
LTM EV/Revenue5.3x
LTM EV/Gross Profit10.8x
LTM EV/EBIT17.9x
LTM EV/EBITDA13.5x
LTM P/E17.4x
LTM EV/FCF77.4x
LTM P/FCF60.2x
LTM P/TB1.8x
LTM P/B7.4x
Dividend Yield1.3%
Payout Ratio22.2%
Executive SummarySituation: Current price is $283.06 versus fair value $232.3 (-17.9% expected return), and valuation confidence is stable. Debate: Bull case depends on FY2026 Guidance Realization: The market must digest management's projection of an EPS with a $17 handle, which is nearly 7% below current consensus expectations of $18.21. Bear case centers on Lower-for-Longer Cyclical Downturn: A global recession would compress discretionary travel spending, leading to a rapid decline in load factors and margins due to the company's high operating leverage. Conclusion: Recommendation is Sell with no position, pending a materially better risk/reward setup.
Bull Case
Record booking volumes and 110% load factors demonstrate sustained consumer demand for experiences; expansion of high-margin private destinations like Perfect Day Mexico will drive continued yield growth.
Bear Case
Decelerating revenue growth (8.8% TTM) and peak margins (27.4%) suggest the easy money has been made; massive insider selling of $643.9M indicates management sees limited further upside.
Key Catalysts
Near-Term (0-6 months)Impact: High
FY2026 Guidance Realization: The market must digest management's projection of an EPS with a $17 handle, which is nearly 7% below current co...
Mid-Term (6-18 months)Impact: Critical
Caribbean Yield Compression: As competitors add 6.7% capacity to the Caribbean market, RCL's ability to maintain its 35% yield premium will...
Long-Term (18+ months)Impact: Moderate
Royal Caribbean is relevant for analysis at this moment because it has just achieved its multi-year Trifecta goals, marking the logical end...
Primary Risks
Concern: High
Lower-for-Longer Cyclical Downturn: A global recession would compress discretionary travel spending, leading to a rapid decline in load fact...
Concern: Medium
Balance Sheet Fragility: While leverage has improved to 3.2x Net Debt/EBITDA, the absolute debt load of $22B remains a significant burden if...
Concern: Medium
The stewardship verdict is a Governance Outcome Tree: 1. Status Quo: Management continues aggressive CapEx, but decelerating yields lead to...
Recent Activity
2026-02-06Analyst Target
+6.72%Firm: Tigress Financial Price Target: $425.00 Price When Posted: $344.95 Implied Upside: +23.2%
2026-01-30Analyst Target
-6.17%Firm: Barclays Analyst: Brandt Montour Price Target: $361.00 Price When Posted: $345.98 Implied Upside: +4.3%
2026-01-29SEC Filing (8-K)
+18.65%Royal Caribbean Group reports 2025 results and issues 2026 guidance
2025-10-28SEC Filing (8-K)
-8.53%Royal Caribbean Group reports strong Q3 2025 results with EPS of $5.74, raises full-year guidance, and announces new Royal Beach Club Santorini.
2025-07-29SEC Filing (8-K)
-5.01%Excerpt: (EX-99.1) Document Exhibit 99.1 ROYAL CARIBBEAN GROUP REPORTS SECOND QUARTER RESULTS AND INCREASES FULL YEAR GUIDANCE MIAMI – July 29, 2025 – Royal Caribbean Group (NYSE: RCL) today reported second quarter Earnings per Share...
Valuation Table
9.8/10Decision Grade
Scenario Range
$31
Bear
$256
Base
$348
Bull
$283