Second Wave of Coronavirus Cases Has Investors Rethinking Cruise Ship Stocks

By Chris Lange Published May 11, 1:04PM EDT

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Second Wave of Coronavirus Cases Has Investors Rethinking Cruise Ship Stocks — © Joe Raedle / Getty Images News via Getty Images

Across the board, cruise companies were tossed around on Monday amid concerns that a potential second wave of coronavirus infections could stifle business. Carnival Corp. (NYSE: CCL | CCL Price Prediction), Royal Caribbean Cruises Ltd. (NYSE: RCL) and Norwegian Cruise Line Holdings Ltd. (NYSE: NCLH) each saw their stocks take a dip to start out the week as global economies are starting to reopen.

It’s no secret that the cruise industry was perhaps the biggest loser from the COVID-19 pandemic. As the markets recovered over the course of April, the cruise stocks saw a boost as well. However, concerns about reopening the economy too soon could crush any hope at recovery for these cruise line operators.

Florida happens to be a major hub for these cruise ships, and the state economy is in the process of reopening, so one would think this should be good news for cruise stocks. In fact, Florida is coming off of its deadliest week on record since the coronavirus pandemic hit the state.

The Florida Department of Health reported an additional 595 new cases of COVID-19 from Saturday to Sunday. This brings the total number of infections to 40,596. Also since last Monday, the state has reported an average of 55 new deaths each day.

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Considering this, a reopening presents problems for these companies. Some cruises have planned target dates for reopening.

Carnival stock traded down about 1.5% to $14.00 on Monday, in a 52-week range of $13.64 to $14.29. The consensus price target is $23.83. In the past month alone, the stock was up about 18.5%. Over the past week, shares are up 2%.

Royal Caribbean stock was down nearly 3% at $38.80, within a 52-week range of $19.25 to $135.32. The consensus price target is $79.46. Excluding Monday’s move, the stock was down 6% in the past month. In the past week, the stock was down 2%.

Norwegian Cruise stock traded down 4%, at $11.91 in a 52-week range of $11.52 to $12.28. The consensus analyst target is $30.54. The stock was up 6% in the past month. However, shares were down 10% in the past week.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.