In this article, we discuss 11 best cruise stocks to buy now.
2024 is poised to be exceptional for cruise vacations, with unprecedented booking volumes across different income levels, surpassing pre-COVID-19 levels. Cruise operators and travel agents report heightened interest due to the relative affordability of cruises compared to land-based alternatives. Despite cancellations in other travel sectors, cruise bookings for 2024 are anticipated to break records. With occupancy levels steadily approaching pre-pandemic levels, cruise operators are contemplating adjustments in pricing strategies to capitalize on the skyrocketing demand. However, this heightened interest in cruise vacations comes against the backdrop of cancellations and postponements of travel plans to other regions, particularly the Middle East. The Cruise Lines International Association predicts 35.7 million passengers in 2024, a 6% increase from 2019.
However, the industry faces a challenge in meeting the demand. Carnival CEO Josh Weinstein highlighted concerns about potential inventory shortages despite a 5% increase in capacity compared to 2023. Smaller operators, such as Oslo-based luxury cruise line SeaDream Yacht Club, report overwhelming demand for bookings in 2024 and beyond, with reservations already open for autumn 2026. Similarly, travel agencies like Marvelous Mouse Travels and InteleTravel have experienced a significant uptick in demand, surpassing pre-pandemic booking levels by considerable margins. Cruise operator Royal Caribbean observed a surge in first-time cruisers. To benefit from this opportunity, online travel companies, including Booking.com, are capitalizing on this trend, launching cruise verticals to cater to the growing demand.
The latest trends in the cruise industry, as highlighted by CLIA, indicate a strong focus on younger generations, with 88% of millennials and 86% of Gen-X travelers who have previously cruised expressing plans to cruise again. Additionally, there is growing interest among millennials and Gen-Xers who have never cruised, with 73% considering a cruise vacation. Similarly, solo cruise travel is on the rise, prompting cruise lines to enhance offerings for solo travelers by increasing single-cabin availability. Moreover, the commitment to environmental considerations is rising among current and potential cruise travelers, with 50% expressing increased dedication to making travel decisions based on environmental impacts. Additionally, expedition cruises are experiencing a surge in popularity, driven by the desire for immersive, responsible, and bucket-list travel experiences. This trend is evident across all age groups, with the number of passengers on expedition cruises more than doubling from 2016 to 2022.
On January 10, 2024, Chicago Tribune quoted Michelle Fee, the CEO and founder of Cruise Planners, an organization with over 2,500 travel agency franchises:
“It’s not pent-up demand anymore. It’s just pure demand. Cruising is back with a vengeance.”
Against this growing market opportunity, some of the best cruise stocks to buy include The Walt Disney Company (NYSE:DIS), Royal Caribbean Cruises Ltd. (NYSE:RCL), and Hilton Worldwide Holdings Inc. (NYSE:HLT).
Our Methodology
For this article, we scanned Insider Monkey’s fourth quarter database of 933 hedge funds and picked 11 companies operating in the cruise industry. These are the best cruise stocks to buy according to hedge funds. Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).
Best Cruise Stocks To Buy Now
11. Lindblad Expeditions Holdings, Inc. (NASDAQ:LIND)
Number of Hedge Fund Holders: 14
Lindblad Expeditions Holdings, Inc. (NASDAQ:LIND) provides marine expedition adventures and travel experiences. The company operates through two segments – Lindblad, which offers ship-based expeditions to remote and culturally significant locations like Antarctica, the Arctic, Galápagos Islands, and Alaska; and Land Experiences, which provides over 100 expedition itineraries in 45 countries, focusing on eco-conscious and nature-focused small-group tours, including cycling adventures with local guides. Lindblad Expeditions Holdings, Inc. also specializes in luxury adventure cruises.
In November 2023, Lindblad Expeditions Holdings, Inc. announced that it extended its 20-year strategic relationship with National Geographic for an additional 17 years, until 2040. The agreement includes global rights to the National Geographic brand for expedition cruises, allowing Lindblad to expand its fleet and enter new market segments.
According to Insider Monkey’s fourth quarter database, 14 hedge funds were bullish on Lindblad Expeditions Holdings, Inc., compared to 12 funds in the earlier quarter.
Like The Walt Disney Company, Royal Caribbean Cruises Ltd., and Hilton Worldwide Holdings Inc., Lindblad Expeditions Holdings, Inc. is one of the best cruise stocks to watch.
Ariel Small Cap Value Strategy made the following comment about Lindblad Expeditions Holdings, Inc. in its Q3 2023 investor letter:
“Alternatively, shares of luxury adventure travel services company, Lindblad Expeditions Holdings, Inc., weighed on results in the period. We believe this recent price action runs counter to the company’s solid business fundamentals. LIND reported revenue and EBITDA ahead of Wall Street expectations. Future travel reservations continue to be strong with both booking trends and pricing for 2023 ahead of pre-pandemic levels. Although more expensive fuel prices and an uptick in discounting from certain competitors may present short-term headwinds, cancelation rates are slowly improving and should result in higher cruise occupancy. Longer-term, we expect LIND’s fundamentals will pave the way for multiple expansion as the company extends its market share in the expedition tourism niche. At today’s valuation, we believe LIND’s risk/reward is skewed sharply to the upside.”
10. World Kinect Corporation (NYSE:WKC)
Number of Hedge Fund Holders: 17
World Kinect Corporation (NYSE:WKC) is an energy management company operating through three segments – Aviation, supplying fuel and services to different aviation entities; Land, offering fuel, lubricants, heating oil, and sustainability solutions to diverse customers; and Marine, providing fuel, lubricants, and services to marine fleets, cruise lines, governments, and other fuel suppliers. World Kinect Corporation is one of the best cruise stocks to invest in. World Kinect Corporation paid a $0.14 per share quarterly dividend to shareholders on January 16. The company’s revenue for the fourth quarter of 2023 came in at $12 billion, in-line with market estimates.
According to Insider Monkey’s fourth quarter database, 17 hedge funds were long World Kinect Corporation, compared to 19 funds in the prior quarter. Ken Griffin’s Citadel Investment Group is the largest stakeholder of the company, with 483,293 shares worth $11 million.
Bernzott Capital Advisors made the following comment about World Kinect Corporation in its second quarter 2023 investor letter:
“World Kinect Corporation: The company’s most recent results produced margins below expectations which negatively impacted stock performance during the quarter. Demand remains firm however within their two largest segments of Aviation and Land, as overall travel has rebounded while pricing should take a step up due to contracts repricing higher.”
9. OneSpaWorld Holdings Limited (NASDAQ:OSW)
Number of Hedge Fund Holders: 19
OneSpaWorld Holdings Limited (NASDAQ:OSW) operates health and wellness centers on cruise ships and destination resorts globally. The centers provide a range of services, including traditional body, salon, and skincare, as well as fitness facilities, specialized classes, and personal training. OneSpaWorld Holdings Limited ranks 8th on our list of the best cruise stocks.
On February 28, OneSpaWorld Holdings Limited reported that its Q4 revenue increased 15.3% year-over-year to $194.8 million. The increase in revenue is attributed to a 9% rise in the average ship count, reaching 184 health and wellness centers onboard ships during the quarter, compared to 169 centers in the fourth quarter of 2022. The company has also introduced a Q1 2024 revenue guidance ranging from $204 million to $209 million, surpassing the consensus estimate of $202.65 million.
According to Insider Monkey’s fourth quarter database, 19 hedge funds were bullish on OneSpaWorld Holdings Limited, compared to 16 funds in the last quarter. John W. Rogers’ Ariel Investments is the largest stakeholder of the company, with 13.4 million shares worth $189 million.
McIntyre Partnership made the following comment about OneSpaWorld Holdings Limited in its Q1 2023 investor letter:
“In the winners column, OneSpaWorld Holdings Limited and STHO contributed 100-500 bps, while SHC and MSGE contributed over 500 bps. In the losers column, no investment lost more than 100 bps. Beyond SHC, the fund also registered gains in two large and long held investments, MSGE and OSW, which rallied 34% and 33%, respectively. MSGE benefited from both strong earnings and anticipation of its value-unlocking spinoff, which I discuss below, while OSW rallied on a faster than anticipated return to profitability and the ongoing recovery in cruise travel. As cruise travel has not yet fully recovered from the pandemic, I believe the sector can improve further as capacity returns, even if overall consumer spending broadly pulls back.”
8. Agilysys, Inc. (NASDAQ:AGYS)
Number of Hedge Fund Holders: 21
Agilysys, Inc. (NASDAQ:AGYS) is a hospitality industry technology developer and marketer, serving North America, Europe, the Asia-Pacific, and India. The company provides hardware and software solutions, including point of sale, property management systems, inventory management, payments, and reservations, aimed at enhancing guest experiences. The company’s solutions cater to multiple sectors, including hotels, resorts, cruise lines, casinos, corporate food service management, restaurants, universities, stadiums, and healthcare applications. Agilysys, Inc. is one of the best cruise stocks to invest in.
On January 22, Agilysys, Inc. reported financial results for its fiscal 2024 third quarter ending December 31, 2023. The company announced a non-GAAP EPS of $0.35 and a revenue of $60.57 million, exceeding Wall Street estimates by $0.09 and $0.5 million, respectively.
According to Insider Monkey’s fourth quarter database, 21 hedge funds were long Agilysys, Inc., same as the prior quarter. Michael Kaufman’s MAK Capital One is the biggest stakeholder of the company, with 3.32 million shares worth $282 million.
Wasatch Micro Cap Growth—U.S. Strategy made the following comment about Agilysys, Inc. in its Q4 2022 investor letter:
“Agilysys, Inc. was the top contributor to strategy performance during the fourth quarter. The company develops application software for point-of-sale, property-management, inventory and procurement applications. Agilysys specializes in the hospitality and retail industries world-wide, and its solutions can be implemented on wireless and mobile devices. The company recently modernized its software, which has proved fortuitous as post-pandemic consumer and business travel has accelerated. On December 15, Agilysys announced an agreement to deploy its cloud-based property-management system software across Marriott’s luxury, premium and select service hotels in the United States and Canada. Beyond the incremental earnings and cash flows related to Marriott, the agreement should help Agilysys win new customers on an ongoing basis.”
7. Sabre Corporation (NASDAQ:SABR)
Number of Hedge Fund Holders: 26
Sabre Corporation (NASDAQ:SABR) is a global software and technology company in the travel industry, with operations in the United States, Europe, Asia-Pacific, and internationally. The company’s Travel Solutions segment runs a business-to-business travel marketplace, offering content from travel suppliers such as airlines, hotels, car rentals, rail carriers, cruise lines, and tour operators; and The Hospitality Solutions segment offers software and solutions to hoteliers through software-as-a-service (SaaS) and hosted delivery models.
On February 15, Sabre Corporation reported a Q4 non-GAAP EPS of -$0.12, beating market consensus by $0.02. Revenue for the quarter increased 8.8% year-over-year to $687 million, but fell short of Wall Street estimates by $4.33 million. In the fourth quarter of 2023, free cash flow amounted to $77 million, marking a significant increase from the $22 million reported in the fourth quarter of 2022.
According to Insider Monkey’s fourth quarter database, 26 hedge funds held stakes in Sabre Corporation, compared to 28 funds in the prior quarter. Terry Smith’s Fundsmith LLP is the biggest stakeholder of the company, with 22.26 million shares worth $98 million.
6. Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH)
Number of Hedge Fund Holders: 31
Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) is a cruise company that operates globally, including in North America, Europe, and the Asia-Pacific. The company manages three brands – Norwegian Cruise Line, Oceania Cruises, and Regent Seven Seas Cruises. It is one of the best cruise stocks to monitor. On February 27, Norwegian Cruise Line Holdings Ltd. reported a revenue of $1.99 billion, up 30.9 % year-over-year and outperforming Wall Street estimates by $30 million.
According to Insider Monkey’s fourth quarter database, 31 hedge funds were long Norwegian Cruise Line Holdings Ltd., compared to 30 funds in the earlier quarter. John W. Rogers’ Ariel Investments is the biggest stakeholder of the company, with 6.2 million shares worth $125.6 million.
In addition to The Walt Disney Company, Royal Caribbean Cruises Ltd., and Hilton Worldwide Holdings Inc., Norwegian Cruise Line Holdings Ltd. is one of the best cruise stocks to monitor. It ranks 6th on our list.
Ariel Small Cap Value Strategy made the following comment about Norwegian Cruise Line Holdings Ltd. in its Q3 2023 investor letter:
“Lastly, Cruise ship operator, Norwegian Cruise Line Holdings Ltd. traded lower in the quarter. The stock’s strong price appreciation ̶up 34.64% year-to-date ̶ drove profit taking following an underwhelming outlook relative to Royal Caribbean Group’s upward guidance revision. Notably, NCLH continues to deliver record cumulative bookings as well as increased occupancy capacity at higher prices. The company remains focused on right sizing its cost base and improving margins to strengthen its foundation for sustainable and profitable growth. Meanwhile, the company executed on its leadership succession plan, with 15-year veteran Harry J. Sommer’s recent appointment to CEO. With an experienced management team at its helm, a young average fleet and solid liquidity position, we remain enthusiastic about the name.”
5. Carnival Corporation & plc (NYSE:CCL)
Number of Hedge Fund Holders: 41
Carnival Corporation & plc (NYSE:CCL) is one of the best cruise stocks to buy. Carnival Corporation & plc (NYSE:CCL) provides leisure travel services globally, with operations in North America, Australia, Europe, and Asia. The company operates through four segments – NAA Cruise Operations, Europe Cruise Operations, Cruise Support, and Tour and Other.
On February 13, Carnival Corporation & plc (NYSE:CCL) ordered its first new ship in 5 years, the 10th in the Excel-class series, to be built by German shipbuilder Meyer Werft. The 180,000-ton ship, accommodating 6,400 passengers, will run on liquefied natural gas. Carnival plans to continue its measured capacity growth strategy with one to two ships per year from 2027 onwards, addressing the needs of specific cruise lines. The Excel-class ship is set to commence service in 2027.
According to Insider Monkey’s fourth quarter database, 41 hedge funds were long Carnival Corporation & plc (NYSE:CCL), up from 33 funds in the last quarter. John Overdeck and David Siegel’s Two Sigma Advisors is the biggest stakeholder of the company, with 16.10 million shares worth $298.5 million.
Aristotle Global Equity Strategy made the following comment about Carnival Corporation & plc (NYSE:CCL) in its Q4 2022 investor letter:
“We first purchased shares of Carnival Corporation & plc (NYSE:CCL), the world’s largest cruise line, during the second quarter of 2019. At the time, we believed the company was improving in quality, as the industry (and shipyards) had consolidated to a point where returns on capital could increase systematically over time. In addition, cruising is underpenetrated when compared to land-based alternatives. Despite the difficulties faced by the cruise industry during the pandemic, in our opinion, consumer appetite for cruising remains high, with cumulative advanced bookings at the upper end of historical ranges. As discussed below, we believe Carnival’s peer Norwegian Cruise Line is more optimally positioned for the coming years.”
4. Royal Caribbean Cruises Ltd. (NYSE:RCL)
Number of Hedge Fund Holders: 54
Royal Caribbean Cruises Ltd. ranks 5th on our list of the best cruises to watch. It is a global cruise company that operates under the brands Royal Caribbean International, Celebrity Cruises, and Silversea Cruises. On February 1, Royal Caribbean Cruises Ltd. provided optimistic guidance for 2024, driven by strong demand and record bookings. The cruise operator anticipates an adjusted profit of $9.50-$9.70 per share for 2024, reflecting a 40% year-over-year increase and surpassing the Street consensus of $9.18. In 2023, Royal Caribbean Cruises Ltd. earned a profit of $6.77 per share. Additionally, for Q1 2024, the company forecasts adjusted EPS between $1.10 to $1.20 per share, exceeding the Street’s consensus estimate of $0.84 per share.
According to Insider Monkey’s fourth quarter database, 54 hedge funds were bullish on Royal Caribbean Cruises Ltd., up from 41 funds in the last quarter. D E Shaw is the biggest stakeholder of the company, with 4.8 million shares worth $632.3 million.
Ariel Fund made the following comment about Royal Caribbean Cruises Ltd. in its Q2 2023 investor letter:
“Several stocks in the portfolio had strong returns over the period. Global cruise vacation company, Royal Caribbean Cruises Ltd., was one of the top 3 performers in the S&P 500 during the quarter. Shares surged following a significant top- and bottom-line earnings beat, as stronger than anticipated consumer demand is driving a record WAVE season. Forward booking trends are also ahead of historical ranges at record pricing. These factors combined with further improvement in onboard spend and solid cost containment led management to increase RCL’s full-year 2023 guidance. We believe the revised revenue and earnings outlook lays the foundation for RCL to exceed its’ three-year strategic imperative, the Trifecta Program.”
3. Hilton Worldwide Holdings Inc. (NYSE:HLT)
Number of Hedge Fund Holders: 57
Hilton Worldwide Holdings Inc. is a hospitality company involved in managing, franchising, owning, and leasing hotels and resorts. Hilton Grand Vacations Members have access to a diverse range of cruise itineraries from major cruise lines and are assured of the best-price guarantee. Hilton Worldwide Holdings Inc. is one of the best cruise stocks to invest in. On February 7, the company declared a quarterly dividend of $0.15 per share, in line with previous. The dividend is payable on March 28, to shareholders on record as of February 23.
According to Insider Monkey’s fourth quarter database, 57 hedge funds were bullish on Hilton Worldwide Holdings Inc., compared to 53 funds in the earlier quarter. Bill Ackman’s Pershing Square is the biggest stakeholder of the company, with 9.18 million shares worth $1.67 billion.
Pershing Square Holdings made the following comment about Hilton Worldwide Holdings Inc. in its first half 2023 investor letter:
Hilton Worldwide Holdings Inc. is a high-quality, asset-light, high-margin business with significant long-term growth potential. In the first half of 2023, Hilton generated robust revenue growth. In the second quarter, HLT’s revenue per room (“RevPAR”), the industry metric for same-store sales, increased 12% as compared to 2022. Recent quarters continue to benefit from stable demand and rising rates driving leisure growth to new highs, while business transient continues to sequentially accelerate, with group sales just now approaching pre-COVID levels.
While net managed and franchised units grew 4% year-over-year during the most recent quarter, slightly below the full year target which Hilton adjusted to approximately 5% per annum, net unit growth (“NUG”) is poised to accelerate in the back half of the year. While management anticipates NUG of approximately 5% this year, they anticipate it will accelerate to 5-6% in 2024 and return to its historical 6-7% range over the next several years. Net unit growth is poised to accelerate in 2024 as Hilton begins to roll out its new premium economy and long-term-stay concepts (Spark and H3, respectively) and as international development activity accelerates. Hilton signed more than 36,000 rooms in the quarter, the largest quarterly signing in the company’s history. The company’s pipeline includes 441,000 rooms with approximately 50% under construction…” (Click here to read the full text)
2. Booking Holdings Inc. (NASDAQ:BKNG)
Number of Hedge Fund Holders: 83
Booking Holdings Inc. (NASDAQ:BKNG) offers a range of online and traditional travel and restaurant reservation services globally. The company operates platforms such as Booking.com, Priceline, Agoda, KAYAK, OpenTable, and Rentalcars.com, facilitating accommodation, flight, activity, rental car, vacation package, and cruise reservations. Booking Holdings Inc. is one of the best cruise stocks to monitor. On February 22, the company initiated a $8.75 per share quarterly dividend. The dividend is distributable on March 28, to shareholders on record as of March 8.
According to Insider Monkey’s fourth quarter database, 83 hedge funds held stakes in Booking Holdings Inc., compared to 81 funds in the last quarter. Ken Fisher’s Fisher Asset Management is a significant position holder in the company, with 376,734 shares worth $1.3 billion.
Ensemble Capital Management stated the following regarding Booking Holdings Inc. in its fourth quarter 2023 investor letter:
“Booking Holdings Inc. (7.60% weight in the Fund): Earlier this year, Booking Holdings rolled out an AI trip planner. Traditionally Booking helps users find the right hotel by offering a search engine to define which city you want to stay in and apply various filters to narrow down the hotel options. With Booking’s AI Trip Planner, a user can use natural language such as “plan a road trip on Route 66, starting in Chicago and ending to Los Angeles.” The Trip Planner then engages with the user like a travel agent, suggesting which cities to stay in each night and various sights to see along the way. Once the trip is planned out, the user can use natural language to generate hotel options, such as by writing “My budget is $200 to $300 a night. It will be my husband and I traveling together.”
Booking’s experiments in AI demonstrate the value of proprietary data sets. While general AI systems such as ChatGPT are designed to answer questions about anything, focused AI systems that leverage a company’s unique data can be far more powerful when applied to specific use cases. With Booking’s AI Trip Planner, the system is unable to answer questions unrelated to making travel reservations. But on the other hand, it is far more likely to understand what the user wants since it already knows that the entire conversation will be about travel. Importantly, Booking’s AI Trip planner has access to the company’s enormous dataset that includes hotel ratings, popular hotels, and all sorts of detailed information about each hotel.”
1. The Walt Disney Company (NYSE:DIS)
Number of Hedge Fund Holders: 89
The Walt Disney Company ranks 1st on our list of the best cruise stocks. Disney Cruise Line, operated by The Walt Disney Company, is a popular cruise line that offers family-oriented cruise experiences. They have a fleet of distinctive ships and sail to multiple destinations, providing entertainment, themed activities, and character interactions for guests of all ages. On February 8, The Walt Disney Company declared a $0.45 per share semi-annual dividend, a 50% increase from its prior dividend of $0.30 paid in January. The dividend is payable on July 25, to shareholders on record as of July 8.
According to Insider Monkey’s fourth quarter database, 89 hedge funds were bullish on The Walt Disney Company, same as the prior quarter. Nelson Peltz’s Trian Partners is the leading stakeholder of the company, with 32.3 million shares valued at $3 billion.
Madison Sustainable Equity Fund made the following comment about The Walt Disney Company in its Q3 2023 investor letter:
“During the quarter, we sold our positions in Bristol-Myers Squibb and The Walt Disney Company. The Walt Disney Company is facing a difficult and uncertain transition in its core media business assets including the ESPN business and other linear media assets. These media assets are cash generative but face secular decline as consumers are cutting their expensive cable subscriptions and moving to alternative streaming options. This has resulted in a decline in operating profits for the media division. The media business has long-term fixed costs related to its sports broadcasting agreement with multiple sports leagues which will further pressure profits during this transition.”
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This article is originally published at Insider Monkey.
