Stifel analyst Steven M. Wieczynski does not expect Royal Caribbean's Q2 results to significantly beat expectations, and he thinks investors' expectations for the results may be "unrealistic," particularly regarding the anticipation of increases in the company's 2017 guidance. However, he recommends buying the stock on any "irrational" weakness following the results, as he thinks that the company's 2018 results could beat his expectations and expects the company's multiple and capital returns to increase. He keeps a $125 price target and a Buy rating on the stock.
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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."