We recently compiled a list of the Jim Cramer Talked About These 11 Stocks Recently. In this article, we are going to take a look at where Royal Caribbean Cruises Ltd. (NYSE:RCL) stands against the other stocks Jim Cramer talked about recently.
Jim Cramer, the host of Mad Money, recently shared his thoughts on the surge in cruise stocks, offering a perspective that diverges from the usual focus on the tech sector. According to Cramer, the excitement over DeepSeek’s impact on technology has caused many to overlook simpler, more accessible opportunities. While questions about power plants, data centers, and the future of companies like Nvidia are complex, Cramer finds comfort in identifying opportunities that are easier to grasp. One such opportunity, he pointed out, is with the cruise line operators.
Cramer cited a comment from the CEO of a cruise operator who mentioned that the current macro environment favors experiences over material goods as spending on leisure and travel continues to rise and said:
“Hey, to me it means the cruise lines were cyclical stories before Covid, but now they’ve become genuine secular growth plays and they may stay that way for a generation.”
He emphasized that many investors are still struggling to accept the rapid growth of cruises in such a short time span, despite travel being a massive $2 trillion industry. Cruises, within that context, offer significant value, Cramer noted.
READ ALSO 7 Stocks on Jim Cramer’s Radar and Jim Cramer’s Game Plan: Top 14 Stocks to Watch
He also highlighted an important factor that has changed the cruise industry since the pandemic: many cruise companies have become far more disciplined in managing their capacity. Unlike before, when too many ships would flood the market, operators are now taking a more cautious approach, which has made the industry more resilient. This shift, according to Cramer, has strengthened the position of cruise lines moving forward. Despite this, he observed that travel and leisure stocks remain undervalued, as many analysts continue to doubt the staying power of the cruise industry.
While Cramer acknowledged that there are still underperforming companies in the market, including a struggling airline stock he pointed out, he firmly stated that he would prefer to own shares in the worst cruise line over the best airline.
Our Methodology
For this article, we compiled a list of 11 stocks that were discussed by Jim Cramer during the episode of Mad Money on January 28. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the third quarter of 2024, which was taken from Insider Monkey’s database of 900 hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
An aerial view of a luxurious cruise ship, surrounded by the blue horizon.
Royal Caribbean Cruises Ltd. (NYSE:RCL)
Number of Hedge Fund Holders: 52
Cramer pointed out that Royal Caribbean Cruises Ltd.’s (NYSE:RCL) stock jumped 12% on January 28. When pondering the reason behind the surge, Cramer explained that the company had not only reported a significant earnings surprise but also saw a remarkable rise in the revenue generated per available cruise day. He added:
“How about this gem? ‘Momentum continues in 2025 with bookings accelerating since the last earnings call resulting in the best five booking weeks in the company’s history.’ Oh, and you want some excitement that got the analysts totally jazzed? In 2027, Royal Caribbean will be introducing river cruising with 10 new ships to take advantage of a fractured market. It’s double-digit growth over the last decade.”
Cramer noted that Royal Caribbean (NYSE:RCL) has a strong reputation, making it easier to imagine the company gaining more market share. This growth potential has led analysts to revise their estimates, not just for the immediate future, but for the coming years as well. Cramer also pointed out an interesting trend with Royal Caribbean and other cruise lines, they are so skilled at what they do that analysts often struggle to keep up with their actual earnings power. As a result, the companies consistently report better-than-expected numbers, which leads to significant rallies in their stock prices. He then said:
“Maybe Wall Street keeps getting taken by surprise because, let’s face it, this industry is full of snobs who don’t understand the appeal of going on a cruise. In fact, they probably wouldn’t be caught dead on one, which is why they can’t get their heads around these stocks. So what’s the appeal? As Jason Liberty, Royal Caribbean’s… CEO laid out in the conference call, ‘Consumers place significant value on visiting multiple destinations and this is even more important to millennial and Gen Z consumers.’ Meanwhile, the macro environment, Liberty says, favors experiences over things as leisure and travel spend continues to grow.”
Cramer highlighted that cruise lines like Royal Caribbean (NYSE:RCL) have become more disciplined in managing their fleet growth after the lessons learned during the pandemic. He noted that in the past, companies frequently added new ships without enough caution, but now the industry is more resilient due to its more careful approach to capacity expansion.
Overall RCL ranks 1st on our list of the stocks Jim Cramer talked about recently. While we acknowledge the potential of RCL as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than RCL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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