Barclays analyst Felicia Hendrix is a buyer of Royal Caribbean (RCL) and Norwegian Cruise Line (NCLH) following yesterday's selloff. Carnival's earnings call yesterday took down all three cruise stocks by "injecting uncertainty regarding Europe into the narrative," Hendrix tells investors in a research note. The analyst acknowledges that there will now be an overhang on the entire group until it becomes clear that this is a Carnival-specific issue. However, it is important to understand that Carnival's strategy in Europe has been operating country-specific brands that source from very specific markets, says Hendrix. The analyst points out that in contrast, Royal Caribbean and Norwegian's brands are globally sourced and marketed, allowing them to fill their ships with customers that will pay the most from anywhere in the world.
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Reports Q1 revenue $3.7B, consensus $3.69B. Load factors in the first quarter were 107%. "Wow, what a great start to the year! Demand for our leading brands and the incredible experiences they deliver continues to be very robust, resulting in outperformance in the first quarter, a further increase of full year earnings guidance, and 60% expected earnings growth year over year," said Jason Liberty, president and CEO, Royal Caribbean Group. "Building on this momentum, we expect to achieve all our Trifecta financial goals in 2024, which allows us to focus on a new era of growth to drive long-term shareholder returns and take a greater share of the rapidly growing $1.9 trillion global vacation market."