SS/RCCL Finances: Improving, Options, Questions??!!

[highplanesdrifters]

Just now, TLCOhio said:

Ouch

Ouch is right. That's going to leave a mark.

[TLCOhio]

6 hours ago, highplanesdrifters said:

Ouch is right. That's going to leave a mark.

 

Yes, sadly, it was a loud and pronounced "Thud" that hit the Norwegian stock today.  Carnival was down 4.5%, only a 1.5% hit today against Royal Caribbean.  

 

From the Wall Street Journal, below is their chart showing the dramatic drop today for Norwegian.  No recovery later in the afternoon.

 

From the Investor's Business Daily financial news website late this afternoon, they had this headline: “NCLH Stock Sinks On Norwegian Cruise Line Outlook” with these highlights: “Occupancy for the second quarter was in-line with the company's guidance at 105%. The occupancy rate was slightly lower than Q2 2019 due to the shift on longer, more immersive itineraries, Norwegian Cruise Line wrote in its results. Full-year occupancy is expected to average 103.5%, which is consistent with its prior guidance.  Norwegian Cruise Lines guided Q3 earnings to improve to 70 cents per share from a loss of 64 cents per share last year. However, the outlook is below the FactSet forecast of 80 cents.”

 

 

Full story at:

https://www.investors.com/news/nclh-stock-sails-76-percent-higher-this-year-norwegian-cruise-line-earnings-on-tap/?src=A00619&refcode=aflMarketWatch

 

THANKS!  Enjoy!  Terry in Ohio

 

Summer 2019 Calgary, Jasper/Banff National Parks, Western Canada Rocky Mountaineer rail adventure, Vancouver, sailing up to Alaska on Silver Muse, post-cruise excursion to Denali, etc.  Many visuals, Our firsts in these scenic areas!  Now at 19,560 views. Live/blog: 

https://boards.cruisecritic.com/topic/2682584-live-terryohio-silver-muse-alaska-canadarockies-pix’s/

[TLCOhio]

20 hours ago, highplanesdrifters said:

Ouch is right. That's going to leave a mark.

 

Before the markets open this morning, all of the cruise line stocks are down based on the over-night trading.  What happens today and later this week?  For Norwegian and the other two major cruise stocks?  

 

From this below-connected financial news website and MSN News this morning, they had this headline: “Norwegian Cruise Line Q2 2023 Earnings Call Transcript” with this highlight from their new CEO Harry Sommer: “With new leadership not only in my seat, but in all three of our award-winning brands and most recently for our vessel operation function, there is a possible feeling of reinvigoration and excitement about the future across the entire company.  We are approaching every decision with fresh perspective and new energy, challenging the status quo at every level and encouraging our entire team to think outside of the box and come to the table with new ideas, however big or small.  As we are fine-tuning our longer-term strategic vision and priorities, we are also focused on execution today.”

 

During this nearly hour-long session, I heard lots of such "happy talk", along with many  cliches and other such phrases, spin, etc.  Clearly, the market did not like what they heard and how Norwegian missed the expected projections.  Read it for yourself and be your own "Judge".  Big contrast for what happened last week with Royal Caribbean going up, UP, versus Norwegian down, DOWN yesterday.  

 

Will share more of my notes and reactions later today.  

 

Here is another example of the comments coming from the Norwegian CEO: "At a high level, this means remaining within a booked position of approximately 60% to 65% on a 12-month forward basis while increasing pricing and maximizing onboard revenue generation. After years of experience, we believe this level will be the sweet spot based on our current deployment mix, and I am pleased to say we are comfortably in this range today.   Our revenue management process is dynamic and we carefully monitor on a granular level how each ship itineranvoyage is tracking against its optimal booking curve and adjust marketing spend, promotional construct and pricing as needed depending on the market environment to maximize each voyage's contribution to the bottom line."

 

Bottom Line: They want to keep jacking up prices and tighten down on costs.  

 

Full story at:

https://www.msn.com/en-us/money/companies/norwegian-cruise-line-nclh-q2-2023-earnings-call-transcript/ar-AA1eES04

 

THANKS!  Enjoy!  Terry in Ohio

 

Early 2020, many visuals and details from New Zealand/South Pacific in going from Auckland to French Polynesia.  This includes Bora Bora, Fiji, NZ experiences, etc:  Live/blog:

https://boards.cruisecritic.com/topic/2735732-live-terryohio-“new”-regatta-south-pacificnz-pix’s/

[TLCOhio]

Here are some of my notes and highlights from listening to yesterday's second quarter Wall Street stock analysts report by the Norwegian CEO and CFO.  As summarized previously, there was much "puff' and "spin" that the stock market did not accept with much trust and excitement in trading yesterday.  

 

There was an interesting comment about  "seeking streamlined booking process using AI technology".  What does that mean for Travel Agents?  Not good or encouraging in my view.  They want to get more customer direct connections to their in-house process and seek to get customers using and doing more via the web for advanced bookings and signing up to gain on-board, revenue-generating activities.  

 

There were several mentions related to their brands offering longer sailings, getting "higher quality guests" and offering better itineraries.  That's to gain more revenue, especially with their Regent and Oceania brands that, in part, compete, somewhat, with Silversea. 

 

Comments came about higher fuel and interest expenses.  They noted that they did not have as much saving from getting rid of older, less-efficient ships compared to other companies.  Mention was made about adding more capacity on their higher-end Regent and Oceania brands with the new ships this year.  They are trying to be more efficient in crew movements, etc.  They have repaid $1.4 billion in debt and intend to re-finance parts of current debt.

 

During the Q&A session, there was discussion about one of their biggest challenge being for future growth.  They have three new ships entering fleet this year.  No new ships in 2024.  But, new ships in 2025.  

 

Pricing up 18%.  But, there was question as to whether that trend was fully sustainable after revenge travel upswing.  Their liquidity was helped by banks releasing $500 million from required credit card reserve.  They will have some dry docking needs to pressure them in 2024.  For their marketing dollars being spent and the process, they said they were getting nearly double results on leads from marketing money.   Mention was made for “margin enhancement” and keeping the "guest experience” gaining high ratings.  But, the question comes up as how to balance both? 

 

Hope this gives a little "flavor" for the discussions, questions, comments, etc.  Interesting business with lots of operational, financial and staffing factors to consider.  This world-wide business is not as simple as running a cement block manufacturing plant in one town.  Many complexities and challenges!!

 

Then, there are the questions as to when and if an economic slow-down hits, timing and how deep.  No questions came up yesterday as to that potential for any type of recession looming. 

 

THANKS!  Enjoy!  Terry in Ohio

 

Late Summer 2022, many scenic visuals and details from Canada Maritimes doing Nova Scotia, Prince Edward Island, Cape Breton Island, etc., via a Tauck land tour.  Visual Summary:

www.flickr.com/photos/196555480@N08/albums

[highplanesdrifters]

Excellent and interesting recap.  Thanks for taking the time.

 

They not going to get this:

 

31 minutes ago, TLCOhio said:

There were several mentions related to their brands offering longer sailings, getting "higher quality guests" and offering better itineraries.  That's to gain more revenue, especially with their Regent and Oceania brands that, in part, compete, somewhat, with Silversea. 

 

 

If they opt for this:

 

32 minutes ago, TLCOhio said:

Mention was made for “margin enhancement”

 

[RetiredandTravel]

 This op-ed gave me a much better understanding of AI.

 

https://www.wsj.com/articles/ai-has-finally-become-transformative-humans-scale-language-model-6a67e641?mod=opinion_lead_pos7

 

"Consider the task of creating an image to use for marketing content or for a movie poster. For companies running their own version of an open-source model like Stable Diffusion, it costs roughly 0.1 cent and takes around one second to generate an image. Hiring a graphic designer or a photographer would cost hundreds of dollars and take hours or days. Even if, for simplicity’s sake, we underestimate the cost at $100 and the time at one hour, generative AI is 1/100,000th the cost and 3,600 times the speed of the human alternative."

 

 

[TLCOhio]

On 8/2/2023 at 9:48 AM, highplanesdrifters said:

Excellent and interesting recap.  Thanks for taking the time.   They not going to get this:  If they opt for this:

 

Appreciate these nice comments and follow-up.  Agree that trying to balance "revenue enhancement" with keeping customers happy can be challenging.  Especially as you are trying to attract new audiences, keep experienced, upscale people, etc., happy,  

 

From the Wall Street Journal this morning, they had this headline: “Stocks Have Had a Great Year. Cue the September Effect" with this sub-headline: "The month is historically the worst for stocks.”

 

Here are some of their analysis highlights: “September is traditionally the weakest month for U.S. stocks. This year, investors say the turning of the calendar should be especially worrying.  Stocks have risen sharply after last year’s selloff, defying any number of risks along the way. The S&P 500 is up 17% so far this year, including a 3.1% increase in July that reflected gains across all 11 sectors. Wall Street’s so-called fear gauge, the Cboe Volatility Index, is sitting well below historical averages.  If history is any guide, investors’ optimism will soon be put to the test. The S&P 500 has lost an average of 1.1% in September dating back to 1928, making it the worst month for stocks’ performance."

 

Also, this headline from yesterday's Wall Street Journal: "America’s Fiscal Time Bomb Ticks Even Louder" with this sub-headline: "Fitch’s downgrade of the U.S. debt rating only caused a flutter in markets, but fiscal strains will soon get harder to ignore".

 

In early, opening trading this morning, all three cruise lines were down, down.  Royal Caribbean dropped to $103.135, a 1.5% value reduction.   Where for the entire week?

 

Full stories at:

https://www.wsj.com/articles/stocks-have-had-a-great-year-cue-the-september-effect-fa922be9?mod=hp_lead_pos4

https://www.wsj.com/articles/americas-fiscal-time-bomb-ticks-even-louder-e2934f65?mod=hp_lead_pos1

 

THANKS!  Enjoy!  Terry in Ohio

 

Barcelona/Med: June 2011, with stops in Villefranche, ports near Pisa and Rome, Naples, Kotor, Venice and Dubrovnik. Great visuals with key highlights, tips, etc. Live/blog now at 256,748 views.

https://boards.cruisecritic.com/topic/1362155-solstice-livefirst-timer-reportspix’s-italycroatian-june-7-19/

[TLCOhio]

17 hours ago, RetiredandTravel said:

 This op-ed gave me a much better understanding of AI.

https://www.wsj.com/articles/ai-has-finally-become-transformative-humans-scale-language-model-6a67e641?mod=opinion_lead_pos7

"Consider the task of creating an image to use for marketing content or for a movie poster. For companies running their own version of an open-source model like Stable Diffusion, it costs roughly 0.1 cent and takes around one second to generate an image. Hiring a graphic designer or a photographer would cost hundreds of dollars and take hours or days. Even if, for simplicity’s sake, we underestimate the cost at $100 and the time at one hour, generative AI is 1/100,000th the cost and 3,600 times the speed of the human alternative."

 

Appreciate this good link from R&T and follow-up about AI and examples for its potentials and impacts.  Yes, it is amazing and quick as to what can be done with creating certain visual images using this technology.  For Travel Agents, the AI technology could be very dramatic with its impact.  The "good TA's" will figure out how to adjust and still be a serious "Value Added" for smart customers.  But, those "order taker" TA's could be in for a rude shock.  Changing times?? 

 

From MSN News and a financial news website this morning, they had this headline: “Betting against cruise ship and hotel stocks backfired and cost hedge funds more than $6 billion” with these highlights: “Hedge funds have lost more than $6 billion on bad bets against cruise ship and hotel operators this year, the Financial Times reported. Of this, the three cruise ship companies account for almost $3 billion of the total mark-to-market losses, according to figures from S3 Partners.”

 

Here is more from their story: "The cruise industry has surged this year, releasing a wave of pent-up demand from the coronavirus pandemic. Year-to-date, Carnival is up 119%, Royal Caribbean is 112% higher, and smaller rival Norwegian is up 53%."  That was "then", but now this week, it seems that some adjustments are coming.  Right or wrong??

 

Full story at:

https://www.msn.com/en-us/money/markets/betting-against-cruise-ship-and-hotel-stocks-backfired-and-cost-hedge-funds-more-than-6-billion-report-says/ar-AA1eMvOB

 

THANKS!  Enjoy!  Terry in Ohio 

 

Norway Coast/Fjords/Arctic Circle cruise from Copenhagen, July 2010, to the top of Europe. Scenic visuals with key tips. Live/blog at 248,131 views.

https://boards.cruisecritic.com/topic/1172051-livesilver-cloud-norway-coastfjords-july-1-16-reports/

[highplanesdrifters]

Given the movement after the  Fitch downgrade thought folks might find this long term chart of the 10 year interesting.

 

[RetiredandTravel]

2 hours ago, TLCOhio said:

 

Appreciate this good link from R&T and follow-up about AI and examples for its potentials and impacts.  Yes, it is amazing and quick as to what can be done with creating certain visual images using this technology.  For Travel Agents, the AI technology could be very dramatic with its impact.  The "good TA's" will figure out how to adjust and still be a serious "Value Added" for smart customers.  But, those "order taker" TA's could be in for a rude shock.  Changing times?? 

 

 

 

I could envision a situation where the TAs are replaced by the AI.  The AI would have a human voice and be polite, funny and extraordinarily efficient.  There would never be a wait, the AI would in seconds know all of your preferences and the entire cruise schedule and pricing.  The AI would immediately answer any question you have and follow up.  You could call (or chat) back and get instant service on any issue.  Think of the productivity gains and labor cost reductions for firms like SS and AMEX.  The only problem is where are the humans going to work? ☹️

 

Edited August 4, 2023 by RetiredandTravel

[RetiredandTravel]

1 hour ago, highplanesdrifters said:

Given the movement after the  Fitch downgrade thought folks might find this long term chart of the 10 year interesting.

 

 

 

Looks like a real long term trend line has been broken doesn't it.  I started my bond career in the early '80s buying 30 year (non call 10) Munis @ 15-16%.

 

 

[dawntrdr]

46 minutes ago, RetiredandTravel said:

The AI would immediately answer any question you have and follow up. 

There are going to have to be some enormous improvements before we get to that stage.  Currently, I can't imagine a more frustrating experience that trying to get an answer from a Chatbot conversation, or calling for information and trying to determine which "press 1 for this", "press 2 for that" choice is most likely to result in an answer my question.

[RetiredandTravel]

Its really just an evolution of voice recognition like Alexa or Siri.  The next level.  There are no press 1 or 2.  My car recognizes my voice and performs the operations I ask.  In the case I mention the programming and ability behind the voice is just more powerful.   I'm not saying it will happen tomorrow but the technology is changing quickly.

[highplanesdrifters]

3 hours ago, RetiredandTravel said:

The only problem is where are the humans going to work? ☹️

What will all the candle makers do?  From Anthem by Ayn Rand.

[RetiredandTravel]

7 minutes ago, highplanesdrifters said:

What will all the candle makers do?  From Anthem by Ayn Rand.

 

 

 

 

https://www.bbc.com/news/technology-65102150

 

 

Edited August 4, 2023 by RetiredandTravel

[highplanesdrifters]

3 hours ago, RetiredandTravel said:

 

 

Looks like a real long term trend line has been broken doesn't it.  I started my bond career in the early '80s buying 30 year (non call 10) Munis @ 15-16%.

 

 

I was thinking the same thing about the trend line.  The last years trading range looks like a flag. If it breaks out, 7%. But I have a hard time seeing that happen.

 

Pretty crazy the the economy functioned at those high rates. My first mortgage was quoted at 16%.  By the time I closed it was under 14%.

[highplanesdrifters]

2 minutes ago, RetiredandTravel said:

 

 

 

 

https://www.bbc.com/news/technology-65102150

 

 

I'm with you my friend. Just gotta stay ahead of the curve.

[TLCOhio]

5 hours ago, RetiredandTravel said:

I could envision a situation where the TAs are replaced by the AI.  The AI would have a human voice and be polite, funny and extraordinarily efficient.  There would never be a wait, the AI would in seconds know all of your preferences and the entire cruise schedule and pricing.  The AI would immediately answer any question you have and follow up.  You could call (or chat) back and get instant service on any issue.  Think of the productivity gains and labor cost reductions for firms like SS and AMEX.  The only problem is where are the humans going to work? ☹️

 

Appreciate these great comments and follow-ups, including about AI and TA's.  More later on these different and important issues and questions.  

 

From the Wall Street Journal below are their charts for the three major cruise lines during the past five trading days.  Was it a strange and dramatic week, especially for Norwegian?   Tuesday, Aug. 1 was a "dark day" for NCLH.  When will they recover and bounce back??

 

THANKS!  Enjoy!  Terry in Ohio 

 

Sydney to NZ/Auckland Adventure, live/blog 2014 sampling/details with many exciting visuals and key highlights.  On page 23, post #571, see a complete index for all of the pictures, postings.  Now at 244,628 views.

https://boards.cruisecritic.com/topic/1896175-solstice-live-australianzhawaii-many-pix’s-jan-20-feb-3/

 

From the Wall Street Journal, here are the stock charts for the past five trading days.  Each of these companies moved in varied way during this most recent period.:

(Open your screen/viewer wider to see these visuals larger/better!)

 

 

 

For the past month/30 days, here has been the movement for the RCL stock.:

[TLCOhio]

It's the summer, but the stock market and financial issues keep rolling along.  Some good.  In other ways, different?   Can anyone really explain it?

 

From the Wall Street Journal below are their charts for the three major cruise lines during the past five trading days.  Generally, the most recent three days have been  "downer" for these stocks.  When will things recover and bounce back??

 

THANKS!  Enjoy!  Terry in Ohio  

 

Venice: Loving It & Why??!!  Is one of your future desires or past favorites? See these many visual samples for its great history and architecture.  This posting is now at 105,450 views.

http://boards.cruisecritic.com/showthread.php?t=1278226

 

 

From the Wall Street Journal, here are the stock charts for the past five trading days.  Each of these companies moved in varied way during this most recent period.  For Royal Caribbean, their pattern for the past week did not exactly match their two main competitors.  Strange?  Why?:

(Open your screen/viewer wider to see these visuals larger/better!)

 

 

 

Here has been the pattern for the broader S&P 500 Index during the past month. Mostly down, down during the past week and a half, right?:

[TLCOhio]

From the Wall Street Journal late this afternoon, Royal Caribbean has now drop down below $100 a share.  Where are things headed and why?  More week's end data tomorrow afternoon.  Looking for the background reasons.  Any hints or ideas?

 

THANKS!  Enjoy!  Terry in Ohio

[TLCOhio]

From the Wall Street Journal late Friday afternoon, below are their charts for the three major cruise lines.  Down, down, DOWN!!  Not a positive, upbeat week for these stocks and the overall market.  

 

Do investors sense something negative is coming in September or October?  The drops have been most sharply down affecting Norwegian.  

 

How do you "bet" as to the market potentials during the four months?

 

THANKS!  Enjoy!  Terry in Ohio

 

Amazon River-Caribbean 2015 adventure live/blog starting in Barbados. Many visuals from this amazing river and Caribbean Islands (Dutch ABC's, St. Barts, Dominica, Grenada, San Juan, etc.).  Now at 72,388 views:

https://boards.cruisecritic.com/topic/2076101-live-amazon-river-caribbean-many-pix’s-terryohio/

 

From the Wall Street Journal, here are the stock charts for the past five trading days.  Each of these companies moved down.  Why?  At the bottom is the overall, broader-market S&P 500 chart for the past month.  It seems to be a larger stock market challenge.  What is coming next?:

(Open your screen/viewer wider to see these visuals larger/better!)

 

 

 

 

 

 

[TLCOhio]

From CNBC cable financial news this morning, they had this headline: “Top Wall Street analysts pound the table on these 5 stocks” with these highlights/specifics about Royal Caribbean which recently raised its full-year outlook and reported blockbuster second-quarter earnings: "The company is enjoying strong business due to pent-up travel demand.  This week, Tigress Financial analyst Ivan Feinseth reiterated a buy rating on RCL and raised his price target to $139 from $102, citing stellar demand for cruise vacations, the company’s industry-leading position and its solid value proposition.  The analyst thinks that the company is well-positioned to gain from the reprioritization of consumer spending toward travel and experiences following the pandemic. He said that demand in North America remains strong. In particular, Feinseth expects RCL’s “Perfect Day at CocoCay” private island resort to be a key growth driver and industry differentiator, which could fuel significant incremental revenue growth and yields.”

 

That analyst also offered this background: “RCL’s current liquidity and ramp-up in cash flow will enable the ongoing funding of its fleet expansion and upgrades, growth initiatives, and balance sheet optimization.”

 

Full story at:

https://www.cnbc.com/2023/08/20/top-wall-street-analysts-pound-the-table-on-stocks-like-amazon.html

 

THANKS!  Enjoy!  Terry in Ohio

 

Athens & Greece: Visuals, details from two visits in a city and nearby with great history, culture and architecture.  Now at 57,130 views.

http://boards.cruisecritic.com/showthread.php?t=1101008

[TLCOhio]

From the Wall Street Journal mid-day, today, below is the chart for Royal Caribbean's stock.  Up, UP!!  Same for Carnival.  Not sure why and what is driving this positive value trend that reversed recent downward slides.  Carnival is up mid-day by a similar margin.  Not as big upward for Norwegian.  

 

Any good guesses for what is happening now with the stock market, longer-term financial trends, etc.??

 

THANKS!  Enjoy!  Terry in Ohio

 

 

[TLCOhio]

From the Wall Street Journal late Friday afternoon, below are their charts for the three major cruise ship lines during this past week.  Lots of UP and DOWN movements!!  How to explain it?  At the bottom is the overall S&P 500 chart for this past week.  The cruise ship stock roughly tracked with those varied larger market movements.  

 

Ant guesses for where these stocks are headed during the upcoming week??  

 

Talking with a key financial expert recently, he made the point to me that historically the month of September has been most negative period during a yearly period.  Will that happen in 2023 and what will that month establish as a pattern for the rest of this year?  How's your Chrystal Ball?  Predictions??

 

THANKS!  Enjoy!  Terry in Ohio

 

Canada 2022/2023: Scenic visuals, details from Canada Maritimes (Nova Scotia, New Brunswick, Prince Edward Island, Cape Breton Island).  Plus, new from Aug. 2023, exploring historic/charming Quebec City.    Visual/Info Summaries:

www.flickr.com/photos/196555480@N08/albums

 

From the Wall Street Journal, here are the stock charts for the past five trading days.  Each of these companies moved up, UP nice on Wednesday and then things went "rocky!".  It seems that the trends for Norwegian were most negative during this past week.   The fourth chart shows the overall market S&P 500 trends for this past week.  Lots of ups and downs?  Reasonable summary?:

(Open your screen/viewer wider to see these visuals larger/better!)

 

 

 

[highplanesdrifters]

14 hours ago, TLCOhio said:

Ant guesses for where these stocks are headed during the upcoming week??  

 

 

I've attached a few screen shots of Powells open and closing remarks from Jackson Hole. The talking heads felt the remarks were hawkish to slightly hawkish.  I disagree, and the market did too.

 

Part of his statement which I feel says it all:

"We are prepared to raise rates further if appropriate, and intend to hold policy at a restrictive level until we are confident that inflation is moving sustainably down toward our objective."

 

Unless we get some surprisingly high inflation numbers he is telling us in this statement they are on hold. One could make the case that his statement was hawkish because he didn't mention "cutting" rates next year, but I feel that's just crazy talk!

 

What does it mean for equities?  One would think a continuation.  The pullback is in concern range but not fear. Gun to my head, up.  Who knows what the market will focus on next week. Certainly not me.😄

 

Curve flattening with a rising 10 year. Bond analysis anyone?  @RetiredandTravel