Legendary Value Investor Seth Klarman is Buying Norwegian Cruise Line (NCLH)

We just covered Forget AI: Legendary Value Investor Seth Klarman Is Buying These 10 Value Stocks in 2026. Norwegian Cruise Line Holdings (NYSE:NCLH) ranks #9 (see Seth Klarman Is Buying These 5 Value Stocks in 2026).

Baupost’s Stake: $67,881,000

Norwegian Cruise Line Holdings (NYSE:NCLH) trades at roughly 9x EV/EBITDA and less than 10x forward earnings. This shows a discount to peers like Royal Caribbean and Carnival, which trade at higher multiples.

In Q1 2026, NCLH returned to profitability with revenue of $2.33 billion and net income of $104.67 million versus a loss a year earlier. Occupancy is expected to exceed 104% in 2026, and Norwegian Cruise Line Holdings’ (NYSE:NCLH) luxury brands continue to see healthy demand. Broader cruise bookings are holding up well across the industry.

The debt load has been the biggest concern hanging over the stock. But most of that debt does not mature until 2030, giving management several years to improve cash flow and reduce leverage. Capital spending is also expected to decline significantly after 2027, potentially freeing up nearly $1 billion annually for debt reduction.

Activist investor Elliott Management has pushed for operational improvements, board changes, and a more disciplined financial strategy. And new CEO John Chidsey has launched a turnaround plan including $125 million in cost savings.

Ariel Small Cap Value Fund stated the following regarding Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) in its Q1 2026 investor letter:

Alternatively, shares of Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) declined during the quarter after earnings guidance came in below investor expectations. The results reflect a transitional period under new leadership as the company …” (Click Here to Read the Letter in Detail).

While we acknowledge the risk and potential of NCLH as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than NCLH and that has 10,000% upside potential, check out our report about the cheapest AI stock.

READ NEXT: 33 Stocks That Should Double in 3 Years and Cathie Wood 2026 Portfolio: 10 Best Stocks to Buy. 

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