What Happened: Shares of Norwegian Cruise Line (NYSE:) fell 13.9% in morning trading after the company reported first-quarter results, with revenue falling below Wall Street expectations. However, adjusted EBITDA and EPS were higher than the consensus forecast. This was due to higher efficiency and the use of fixed costs.
Occupancy for the quarter was 104.6%, and the company noted that it received “unprecedented levels of advance ticket sales.” These high numbers likely contributed to the recent decision to build eight new ships.
Looking ahead, the company raised its full-year profit forecast, slightly beating Wall Street estimates.
Zooming out, we think it was a mixed but weaker quarter for the company.
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What the market tells us: Shares of the Norwegian cruise company are highly volatile, with 27 movements in the last year exceeding 5%. But such big moves are very rare even for a Norwegian cruise line, indicating that the news has had a significant impact on market perception of the business.
The biggest move we’ve written about in the past year came two months ago, when shares rose 18.7% on news that the company reported fourth-quarter results and provided upbeat earnings guidance for the next quarter that beat analysts’ expectations . Its revenue for the quarter narrowly beat Wall Street estimates.
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On the other hand, the days of passenger cruises were unfortunately lost, and earnings per share fell short of Wall Street estimates. Overall, it was a mixed quarter for the Norwegian cruise line, but the outlook certainly offers some optimism.
Shares of the Norwegian cruise line are down 8.6% year to date, and at $16.69 per share it is trading 25.9% below its 52-week high of $22.52 from July 2023. Investors who bought $1,000 worth of Norwegian cruise company stock 5 years ago now look at an investment worth $288.79.