NCLH Stock Pops as Truist Upgrades Norwegian Cruise Line

  • Norwegian Cruise Line (NCLH) stock is trending after Truist upgraded the shares to “buy” from “hold.”
  • At the same time, one of the firm’s analysts acknowledged the risks of investing in Norwegian.
  • NCLH stock is up a little over 1% even as the broader stock market is in the red.
Norwegian Cruise Line ship in Spain. NCLH stock.
Source: Roberto Sorin / Shutterstock

Is Norwegian Cruise Line (NYSE:NCLH) ready to turn the ship around? That’s the question of the day as traders mull the comments of Truist analyst C. Patrick Scholes. Reportedly, Scholes issued an upgrade and price target raise for NCLH stock. This is helping shares stay in the green even as many other stocks trade underwater this morning.

Here’s the lowdown. Scholes apparently sees improvement in both pricing and booking volumes for luxury cruise lines. Hence, the analyst concluded that Norwegian Cruise Line could soon benefit; roughly one third the company’s business serves the luxury cruise market.

With that assessment, Scholes upgraded shares of NCLH stock from “hold” to “buy.” The analyst also raised the price target from $18 to $19 per share.

NCLH Stock Is Up Even as the Market Is Down

A $1 price target hike may not seem like much. Yet, Truist’s target now implies a sizable 22% increase from today’s NCLH stock price of around $15.50 per share.

Shares of Norwegian Cruise Line are only gaining between one and two percentage points right now, but let’s put this in context. All of the major stock market indices are also in the red. That makes any gains today noteworthy.

That said, Scholes doesn’t want investors to jump to any hasty conclusions with Norwegian Cruise Line. Indeed, some of the analyst’s comments sound somewhat bearish.

In particular, Scholes took note of the “high volatility” of NCLH stock due to the company’s “high fixed operating costs and massive amounts of debt.” Moreover, the analyst “would have liked to have seen several more months of consistent revenue improvement data before upgrading NCLH.”

Thus, Truist clearly isn’t all in on Norwegian Cruise Line. Nevertheless, the upgrade and price target raise are encouraging. All in all, Norwegian’s investors are at least having a decent day, even as the broader market looks like a sinking ship.

On the date of publication, David Moadel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

Article printed from InvestorPlace Media,

©2023 InvestorPlace Media, LLC