Truist thinks it’s time to get back on board Norwegian cruise lines

With booking and pricing trends remaining positive and 2024 earnings upside generated by elevated pricing on near-in bookings, Truist Securities upgraded Norwegian Cruise Lines (NYSE:NCLH) to Buy from Hold and bumped up their price target by $1 to $21. At the same time, Truist raised its price target for Royal Caribbean (RCL) by 16% to $175.

For Carnival Corp (CCL), Truist maintained its Hold rating but lowered the price target by $1 to $17 as competition from privately-owned MSC, a “value-priced brand” is targeting Carnival (CCL) customers and disrupting the segment dominated by Carnival (CCL) with five contemporary-segment ships and heavy marketing as it breaks into the North American market. While Carnival’s (CCL) Celebration Key is a favorable development, this amenity is unlikely to “move the earnings needle as much as it would for a smaller company.”

For Norwegian (NCLH), Truist analysts led by C. Patrick Scholes thinks its “time to get back onboard NCLH” given the poor stock performance (-20% since July) and that there is still “attractive upside potential” to shares even if the company misses their 2026 EPS guidance of $2.45 by 20%.

“Assuming a 20% miss would imply $1.96 of EPS and using a slightly more conservative 10x multiple than we currently apply on our new price target still gets us to nearly $20 per share or approximately 20% upside from current levels,” Scholes says.