RCL - Embedded Expectations Analysis - 2020 02 25
ï€ Royal Caribbean Cruises Ltd (RCL:USA) currently trades near recent averages relative to UAFRS-based (Uniform) Earnings, with a 19.5x Uniform P/E. At these levels, markets are pricing in bearish expectations for the firm, and management may be concerned about increased costs, their investments, and inventory managementï€ Specifically, management is confident they have increased their cost guidance due to increased product development investments and the operations of the Silversea Cruise Terminal. Furthermore, management may be concerned about their investments in island developments, the progress of the launch of Odyssey of the Seas, and the potential yield impact of Thomas Cook related headwinds. Finally, they may lack confidence in their ability to manage their inventory, and they may be downplaying concerns about Caribbean demand
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