StocksRunner logo

Norwegian Cruise Beats Earnings Estimates but Revenue Miss Sinks Shares: Why the Disconnect?

  • user  Investment.Sensei
    Investment.Sensei  Investment.Sensei

    Your trusted guide to the stock market. 📈 Unlock the wisdom of wealth creation with expert insights and strategies.


stocks on the run



Norwegian Cruise Line reported its first profitable quarter since 2019 pandemic disruptions
Q1 EPS of $0.16 topped estimates of $0.09, driven by strong cruise demand
Raised FY2024 EPS outlook to $1.32 from $1.23 on record booking volumes
Shares fell 14% as revenue miss sparked economic growth concerns

Norwegian Cruise Line (NCLH) sailed back to profitability in Q1 2024, but the cruise operator's earnings report failed to impress investors. Despite returning to the black for the first time since 2019 and raising full-year guidance, shares plunged 14% on Wednesday. The revenue miss overshadowed the positives, reigniting worries about consumer spending amid economic uncertainties.


Cruising Into the Black Again


For the first three months of 2024, Norwegian Cruise posted earnings per share of $0.16. This solidly beat Wall Street's expectations of $0.09 EPS. It also marked a significant turnaround from the $1.07 per share loss in Q1 2023 at the depths of the pandemic's impacts on the cruise industry.


The company benefited from a continued boom in cruise demand as travel rebounded. Norwegian reported record bookings for the quarter, allowing it to push through higher pricing. Revenue per passenger cruise day increased 8% year-over-year.


Full Steam Ahead, But Hitting Headwinds


Even with the return to profitability, Norwegian's Q1 performance failed to wow investors. Total revenue of $2.19 billion missed analysts' average estimate of $2.23 billion. This slight miss on the top line was enough to raise fears that consumer appetite for cruises and vacations may be waning amid recession risks.


CEO Frank Del Rio acknowledged some emerging headwinds in the company's earnings release: "While the Wave cruise booking period exceeded expectations...there has been some slippage in recent weeks, likely reflecting consumer uncertainty about the economic environment, which we are watching closely."


That said, Del Rio remained optimistic that 2024 would be a year of continued growth and recovery coming out of the pandemic. Norwegian raised its full-year earnings per share forecast to $1.32, up from prior guidance of $1.23.


Expectations Had Been Cruising For Troubled Waters


The disappointing revenue figure seemed to be the catalyst for Norwegian's double-digit stock drop post-earnings. However, investor expectations had also likely baked in scenarios for potential challenges amid troubled economic waters.


This showed up in analyst ratings heading into the report. Despite Norwegian restoring profitability, only 32% of analysts rated the stock as a "Buy" with 68% recommending a "Hold." The average 12-month price target of $17.54 implied just 8% upside from current levels around $16 per share.


Within the cruise industry, Norwegian has trailed peers like Carnival (CCL) and Royal Caribbean (RCL) in stock performance over the past year. Shares of Norwegian are up 30% compared to 56% for Carnival and an eye-popping 108% gain for Royal Caribbean.


Norwegian has a lower market cap around $7 billion compared to $24 billion for Royal Caribbean and $19 billion for Carnival. The relatively smaller size of Norwegian may be making its outlook appear more susceptible to economic pressures impacting consumer demand.


A Passing Storm or Larger Economic Swell?


The key question is whether this disappointing Q1 report is a one-off anomaly as Norwegian gets its cruising operations back to full strength, or an early sign of larger consumer belt-tightening. Broader economic indicators have been mixed, with resilient employment but slowing inflation and manufacturing activity.


Del Rio reiterated that while bookings have moderated in recent weeks, Norwegian's forecast still calls for a "significant" increase in pricing for the full year. If that pricing power persists, it could ease concerns about consumer demand and Norwegian's ability to deliver on its raised profit outlook.


The cruise industry has historically been a leading economic indicator, with bookings falling off before economic contractions take full shape. As such, Norwegian's results will be closely watched as a potential bellwether for consumer health.


CEO Del Rio acknowledged the need to "watch closely" going forward, but maintained an optimistic tone in his ability to navigate short-term choppiness:


"Over our company's 57-year history, we have proven our ability to successfully navigate all types of environments, and we are confident that our...strategy will continue delivering strong financial performance and record setting results."


For investors, deciding whether to buy the dip or avoid these murky waters may come down to the level of economic concerns priced into Norwegian's now 14% lower valuation following Q1 earnings.


NCLH Stock Analysis

Last Price


Total Score

StocksRunner Raring Score
Strong Sell
Strong Buy




 Earnings are forecast to grow


 Investors confidence is positive


 Trading below its fair value


 Outperform the market


Risk Level

Risk Level

NCLH has Low Risk Level. Click here to check what is your level of risk


Unlock insights and stay ahead in the stock market game. Click Here For More NCLH in-depth stock analysis.


stocks on the run


Unlock Exclusive Stock Insights!

Join for daily market updates, expert analyses, and actionable insights.

Signup now for FREE and stay ahead of the market curve!

Why Join?

Find out what 10,000+ subscribers already know.

Real-time insights for informed decisions.

Limited slots available, SignUp Now!

Login to Stocksrunner

Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.

StocksRunner logo

Get all the pieces of the puzzle on important data activity before the major news sources break the story and find out what happening right now and what could happen in the future



StocksRunner on Facebook StocksRunner on Twitter StocksRunner on YouTube StocksRunner on stocktwits StocksRunner Rss

Receive our Daily Alerts

Discover the wisdom that over 10,000+ subscribers love! Join us for unique insights and keep ahead in the stock world. Just drop your email to get daily updates!

Our Services

Real-time stock market updates

Expert stock analysis

Investment strategies

Top stock recommendations

Trading signals and opportunities

About StocksRunner

Log In

Sign Up

Contact Us

Terms of use

Privacy Policy


Disclaimer: Past performance, whether explicitly stated or inferred from historical testing of methodologies, does not serve as an assurance of future outcomes or achievements. The displayed outcomes pertain to a strategy not historically accessible to investors and do not epitomize the returns achieved by any specific investor. The Readiness Indicators, Sentiment Indicators, and aggregate score derive from a model retrospectively applied to historical data. This model is founded on assumptions intrinsic to its construct, which may remain unverifiable and expose stakeholders to potential losses. Engaging in active trading may not be advisable for individuals possessing limited financial resources, restricted investment or trading acumen, or a conservative risk profile. Please be advised that your invested capital is subject to inherent risks.

Kindly be informed that StocksRunner and its affiliated entities ("TS") neither extend nor endorse any proposition, invitation, or recommendation concerning the acquisition or divestiture of securities, derivatives, prospective products, or any form of investment guidance or strategy.

The information presented herein serves exclusively for illustrative purposes. It is imperative not to predicate investment decisions solely on the content of this platform. Prior to making any financial commitments, it is prudent to evaluate its relevance to your specific circumstances and consult with professionals specializing in financial, tax, and legal domains.

StocksRunner logo


Get the pulse of the market

StocksRunner logo

Find out what happening right now and get all the pieces of the puzzle on important data activity before the major news sources break the story and see what are the trends


StocksRunner on Facebook StocksRunner on Twitter StocksRunner on YouTube StocksRunner on stocktwits StocksRunner Rss


Receive our Daily Alerts

Unlock the knowledge that 10,000+ subscribers already cherish. Join for exclusive insights and stay ahead in the stock game! Enter your email to receive daily alerts

Market trends

In-depth stock analysis

Informed investment decisions

Stock market insights

Stock trading tips

Stocks analysis

Stocks trends

Stocks performance

Stocks analysis

Investment strategies

Stock strategies

Trading strategies

StocksRunner updates

StocksRunner ideas

Financial Reports


Disclaimer: The Score performance whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The results reflect performance of a strategy not historically offered to investors and does not represent returns that any investor actually attained. The Readiness Indicators, Sentiment Indicators and total score are calculated by the retroactive application of a model constructed on the basis of historical data and based on assumptions integral to the model which may or may not be testable and are subject to losses. Active trading is generally not appropriate for someone of limited resources, limited invesment or trading experience, or low-risk tolerance. Your capital may be at risk.

Please note that no offer or solicitation to buy or sell securities, securities derivatives of future products of any kind, or any type of trading or invesment advise, recommendation or strategy, is made, given or endorsed by StocksRunner including any of their affiliates ("TS").

This information is provided for illustrative purposes only. You should not rely on any advice and/or information contained in this website and before making any investment decision. we recommend that you consider whether it is appropriate for your situation and seek appropriate financial, taxation and legal advice.