Is Royal Caribbean Cruises Ltd. (RCL) Stock A Good Buy?

Everybody loves taking a nice cruise, right? Well, if you answered yes to this question you probably know a thing or two about Royal Caribbean Cruises Ltd. (NYSE:RCL). Royal Caribbean has been the king of the high seas for many years, and despite some issues as of late, the company continues to be one of the major players.

Of course, the amount of fun you have while floating around the ocean has nothing to do with how the company’s stock will perform. Many people find themselves asking the question, is Royal Caribbean stock a good buy?

For more information on where things stand right now with Royal Caribbean Cruises Ltd. (NYSE:RCL), we don’t have to look any further than a recent CNBC video interview with company Chairman and CEO Richard Fain.

Royal Bank of Canada (USA) (NYSE:RY)

In the interview, Fain talked extensively about the outbreak. From a PR and customer service perspective, he is doing all he can to downplay the incident as a means of keeping future customers interested in the company while also hedging against the possibility of a hit on Wall Street. He said, “Obviously we will be compensating the passengers. Our people really do feel very badly that something like this happens, but unfortunately this is a bad time of the year.”

From there, Fain is asked about what he thinks this will do to future bookings for Royal Caribbean Cruises Ltd. (NYSE:RCL). He said, “I don’t think it is has a big impact on bookings because most people understand just how common this thing is. It is the second most common illness in America.”

Okay, enough talk about the illness that brought Explorer of the Seas back to port prematurely. What does the future hold for the company’s stock price? Despite the fact that Royal Caribbean ran into some difficulties during 2013, it appears that the seas have calmed and 2014 could be better for the company.

The economy recovering, which means more people will be spending money on vacations. Fain noted that much of the available space for 2014 was booked during 2013 as the company looked to capitalize on its marketing and promotion efforts. On one side of things this is good to hear because it means that they got a jump on the action. On the downside, it could limit how much the company is able to benefit from the recovery.


Valued at less than 13 times earnings, Royal Caribbean Cruises Ltd. (NYSE:RCL) seems to be a good buy at the time being. If you can stomach what happened in 2013, getting in now may allow you to see some nice gains as the next 12 months wear on. Are you going to get in on the action, just the same as these hedge fund managers: Manish Chopra, Brad Gerstner, and Zac Hirzel and others that revealed ownership of Royal Caribbean shares in their 13F filings.

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