Why Royal Caribbean Cruises (RCL) Is Back in Focus

Royal Caribbean Cruises (RCL) is back on investors’ radar after fourth quarter and full year 2025 earnings that met Wall Street expectations, new 2026 revenue guidance, fresh ship orders, and a completed share buyback.

The company reported fourth quarter 2025 sales of US$1,323 million, compared with US$1,161 million a year earlier, on revenue of US$4,259 million versus US$3,761 million. Net income for the quarter was US$754 million, with basic earnings per share from continuing operations of US$2.78 and diluted earnings per share of US$2.76.

For full year 2025, sales were US$5,419 million, with revenue of US$17,935 million and net income of US$4,268 million. Basic earnings per share from continuing operations were US$15.75 and diluted earnings per share were US$15.61. Management said performance was supported by robust guest demand, commercial execution, cost efficiencies, and contributions from new ships and exclusive destinations.

The earnings release, 2026 revenue outlook and new Discovery Class ship orders have coincided with strong share price momentum, with a 90 day share price return of 31.33% and a 1 year total shareholder return of 33.30%, building on a very large 3 year gain.

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With RCL up 31.33% over 90 days and trading only about 1.4% below one intrinsic value estimate and roughly 4% under one analyst target, are you looking at a fresh opportunity or a stock already pricing in future growth?

Most Popular Narrative: 3.9% Undervalued

Royal Caribbean Cruises last closed at $348, while the most followed narrative puts fair value at about $362. This frames today’s price as slightly below that estimate.

The fair value estimate has risen by about $31, from $331.04 to $362.04 per share, reflecting updated inputs to the valuation model.

The revenue growth assumption has edged lower, from 9.32% to 8.94%, indicating a more conservative view on top line expansion.

Read the complete narrative. Read the complete narrative.

Want to see what is sitting behind that higher fair value, even with trimmed growth assumptions? The narrative leans heavily on profitability and long term earnings power. Curious which combination of margin expectations, revenue trajectory, and future valuation multiple gets you to that $362 mark?

Result: Fair Value of $362.04 (UNDERVALUED)

However, this story still leans on consumers keeping cruise spending resilient and on fuel and currency conditions remaining supportive, which could both shift and pressure margins.

Build Your Own Royal Caribbean Cruises Narrative

If you see the numbers differently or want to pressure test your own view, you can build a personalised narrative in just a few minutes: Do it your way

A great starting point for your Royal Caribbean Cruises research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.