In a report released yesterday, Jamie Rollo from Morgan Stanley maintained a Hold rating on Royal Caribbean (RCL – Research Report), with a price target of $270.00.
Jamie Rollo has given his Hold rating due to a combination of factors related to Royal Caribbean’s financial outlook and strategic plans. The company’s new ‘Perfecta’ performance program aims for a 20% EPS compound annual growth rate (CAGR) by 2027, which aligns closely with market expectations and Morgan Stanley’s estimates. While this growth target is ambitious compared to past performance, it suggests that EPS growth might decelerate in the latter years of the plan.
Moreover, the company’s strategy focuses on moderate capacity and revenue yield growth, alongside strong cost control, which could support the projected EPS increase. However, the limited impact of the company’s expansion into river cruising and the absence of additional share repurchase plans beyond the existing $1 billion program may temper expectations. Additionally, macroeconomic concerns have influenced a recent share price drop, although this is not specific to Royal Caribbean. These factors collectively contribute to the Hold rating, reflecting a balanced view of potential growth and existing challenges.
According to TipRanks, Rollo is ranked #7526 out of 9384 analysts.