More bad news for the cruise industry as Royal Caribbean's Grandeur of The Seas catches fire. But, is now the best time to go full steam ahead with the stock?
As the summer vacation season starts, there’s a bit of bad news for cruises. Royal Caribbean Cruises’ ship, Grandeur of The Seas, caught fire off the coast of Florida over the weekend, forcing more than 3,000 passengers to disembark in The Bahamas.
This is the latest in a string of bad publicity for cruise ships. Over the past year, rival Carnival Cruise Ships had a string of incidents on several of their ships, most notably an engine room fire on the Carnival Triumph which left thousands of passengers stranded for days in the Gulf of Mexico. And, a little more than a year ago, the Costa Concordia ran aground and partially sank on the coast of Italy, killing 32 passengers.
Meanwhile, the company’s stock is up 46% in the past twelve months. During that same time, revenues are up 4.2% to nearly $7.8 billion and the company is trading 5% less than its book value.
So, where is this ship sailing next?
We ask Talking Numbers contributors Richard Ross, Global Technical Strategist at Auerbach Grayson, and Richard Ross, Global Macro Editor at RiskReversal.com, to tell us what’s next for Royal Caribbean’s itinerary.