Royal Caribbean Cruises (RCL) Sentiment Drops 10 Points After Earnings

Royal Caribbean Cruises (NYSE: RCL) | RCL Price Prediction shares continue to sell off as social sentiment on platforms like Reddit, X, and others turns negative following earnings. The current sentiment sits at just 32/100, compared to 42/100 a week ago.

Shares are down 13% in the last month, with the majority of that coming in the last two days after the company reported weak earnings that missed expectations. Though, Royal Caribbean revenue was up to $5.14 billion, a 5.2% increase over the prior period, this fell short of the $5.17 billion retail investors and Wall St were expecting.

And things look worse the deeper you dig.

• Passengers carried was 2.47 million compared to the 2.56 million expected
• Net Cruise costs excluding fuel per available passenger cruise days (APCD) underwhelmed at $123.75 vs the 125.98 expected
• And APCD itself was down to 13,698.9 vs the 13,702.2 expected

What Reddit and X Users Had To Say About Royal Caribbean

While most users on Reddit this past week have been discussing the on board credit (OBC) discount offered to Royal Caribbean shareholders (similar to Geico’s insurance discounts offered to Berkshire Hathaway shareholders) there are some other interesting tidbits.

Comment
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As you can see, Reddit users are pretty negative on Royal Caribbean the company, frustrated by the miserly level of service. But more than applying just to their personal experience, this is seen as a reason the company is underperforming.

X had some more interesting analysis. One user, @SimpleStocks_ made an astute observation that PayPal (Nasdaq:PYPL) and Royal Caribbean Cruises (NYSE:RCL) posted similar numbers with one soaring and the other selling off hard, noting that mentioning OpenAI was the difference.

While that’s an interesting comparison, the reality is more complicated. Royal Caribbean Cruises is a very capital intensive business that will react in exaggerated fashion based on the economic health (or weakness) of consumers.

The Birds Eye View

Lately we are seeing cautious sentiment shift regarding heavily exposed consumer discretionary stocks, like Royal Caribbean, but also Nike NYSE: (NKE), and Chipotle (NYSE:CMG). Investors seem to be looking for any consumer weakness as a sign that the current AI enthusiasm is a bubble about to pop.

So far 247 Wall St. has not seen any major cracks in the armor of US spending, but that doesn’t mean they won’t turn up. Keep at eye on Chipotle’s earnings tonight for additional hints of consumer strength, or weakness.