What's in Store for Royal Caribbean's (RCL) Q1 Earnings?
Royal Caribbean Group RCL is scheduled to report first-quarter 2022 results on May 5, before the opening bell. In the last reported quarter, the company delivered a negative earnings surprise of 29.2%.
Q1 Estimates
The Zacks Consensus Estimate for the company's first-quarter bottom line is pegged at a loss of $4.65 per share. In the prior-year quarter, the company reported a loss per share of $4.44. The consensus mark for revenues stands at $1.18 billion, suggesting a whopping growth of 2,717.2% from the year-ago reported figure.
Factors to Note
Royal Caribbean's first-quarter performance is likely to have benefited from pent-up demand and improved booking trends. Increased focus on new ship additions and resumption of operations might have contributed to the company's first-quarter top line. During the prior quarter's earnings call, the company announced that it anticipates operating at 95% during first-quarter 2022. The company's operating ships may have generated positive cash flow in first-quarter 2022.
Emphasis on technological innovations and product development initiatives, including revamped websites, new vacation packaging capabilities, support for mobile apps and increased bandwidth onboard, may have driven the company's performance in the quarter to be reported.
The Zacks Consensus Estimate for passenger ticket revenues and onboard and other revenues is currently pegged at $680 million and $384 million, compared with $20.8 million and $21.2 million, respectively, reported in the prior-year quarter.
However, uncertainty stemming from pandemic-induced cancellations, interruptions and changing protocols might have dented the to-be-reported quarter's performance. The spread of the Omicron variant in early January impacted the company's cancellations as well as bookings for near-term sailings. In first-quarter 2022, the company expects net interest expense in the range of $270 million to $275 million. High costs might have weighed on the company's performance in the first quarter.
Royal Caribbean Cruises Ltd. Price and EPS Surprise
Royal Caribbean Cruises Ltd. price-eps-surprise | Royal Caribbean Cruises Ltd. Quote
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for Royal Caribbean this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that's not the case here.
Earnings ESP: Royal Caribbean has an Earnings ESP of -7.48%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.
Zacks Rank: The company has a Zacks Rank #4 (Sell).
Stocks With Favorable Combinations
Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to deliver an earnings beat this time around.
Golden Entertainment, Inc. GDEN has an Earnings ESP of +7.72% and a Zacks Rank #2.
Shares of Golden Entertainment have gained 40.4% in the past year. GDEN's earnings surpassed the consensus mark thrice in the trailing four quarters and missed once, the average surprise being 204.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.
Callaway Golf Company ELY has an Earnings ESP of +7.22% and a Zacks Rank #3.
Shares of Callaway have declined 24.5% in the past year. ELY's earnings surpassed the consensus mark in each of the trailing four quarters, the average surprise being 1,047.2%.
Penn National Gaming, Inc. PENN has an Earnings ESP of +9.50% and a Zacks Rank #3.
Shares of Penn National have declined 19.4% in the past three months. PENN's earnings surpassed the consensus mark in two of the trailing four quarters and missed twice, the average surprise being 6.9%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Penn National Gaming, Inc. (PENN) : Free Stock Analysis Report
Callaway Golf Company (ELY) : Free Stock Analysis Report
Golden Entertainment, Inc. (GDEN) : Free Stock Analysis Report
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