Norwegian Cruise Line (NCLH) Suffers a Larger Drop Than the General Market: Key Insights

Norwegian Cruise Line (NCLH) ended the recent trading session at $18.95, demonstrating a -3.51% change from the preceding day's closing price. The stock's change was less than the S&P 500's daily loss of 1.51%. Meanwhile, the Dow lost 0.97%, and the Nasdaq, a tech-heavy index, lost 2.01%.

Heading into today, shares of the cruise operator had lost 17.27% over the past month, lagging the Consumer Discretionary sector's loss of 3.7% and the S&P 500's loss of 3.63%.

The investment community will be paying close attention to the earnings performance of Norwegian Cruise Line in its upcoming release. It is anticipated that the company will report an EPS of $0.16, marking a 128.57% rise compared to the same quarter of the previous year. Meanwhile, our latest consensus estimate is calling for revenue of $2.34 billion, up 9.87% from the prior-year quarter.

NCLH's full-year Zacks Consensus Estimates are calling for earnings of $2.44 per share and revenue of $10.56 billion. These results would represent year-over-year changes of +15.64% and +7.49%, respectively.

Any recent changes to analyst estimates for Norwegian Cruise Line should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 3.45% lower within the past month. Norwegian Cruise Line is currently sporting a Zacks Rank of #5 (Strong Sell).

In terms of valuation, Norwegian Cruise Line is presently being traded at a Forward P/E ratio of 8.05. For comparison, its industry has an average Forward P/E of 15.63, which means Norwegian Cruise Line is trading at a discount to the group.

It's also important to note that NCLH currently trades at a PEG ratio of 0.48. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NCLH's industry had an average PEG ratio of 1.31 as of yesterday's close.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 169, putting it in the bottom 32% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

#1 Semiconductor Stock to Buy (Not NVDA)

The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.

One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.

See This Stock Now for Free >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Norwegian Cruise Line Holdings Ltd. (NCLH): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research