The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Norwegian Cruise Line (NYSE: NCLH) and the rest of the travel and vacation providers stocks fared in Q2.
Airlines, hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional airlines, hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.
The 18 travel and vacation providers stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was in line.
Thankfully, share prices of the companies have been resilient as they are up 5.6% on average since the latest earnings results.
Norwegian Cruise Line (NYSE: NCLH)
With amenities like a full go-kart race track built into its ships, Norwegian Cruise Line (NYSE: NCLH) is a premier global cruise company.
Norwegian Cruise Line reported revenues of $2.52 billion, up 6.1% year on year. This print fell short of analysts’ expectations by 1.7%. Overall, it was a slower quarter for the company with EBITDA guidance for next quarter missing analysts’ expectations significantly and EPS in line with analysts’ estimates.
“We are pleased to have expanded our Revolving Loan Facility, further strengthening our liquidity position and enhancing financial flexibility,” said Mark A. Kempa, executive vice president and chief financial officer of Norwegian Cruise Line Holdings Ltd.
Interestingly, the stock is up 14% since reporting and currently trades at $26.71.
Read our full report on Norwegian Cruise Line here, it’s free.
Best Q2: Pursuit (NYSE: PRSU)
With attractions ranging from glacier tours in the Canadian Rockies to an oceanfront geothermal lagoon in Iceland, Pursuit Attractions and Hospitality (NYSE: PRSU) operates iconic travel experiences, experiential marketing services, and exhibition management across North America and Europe.
Pursuit reported revenues of $116.7 million, down 69.2% year on year, outperforming analysts’ expectations by 6.9%. The business had a stunning quarter with a beat of analysts’ EPS estimates and full-year EBITDA guidance exceeding analysts’ expectations.
The market seems happy with the results as the stock is up 22% since reporting. It currently trades at $36.65.
Is now the time to buy Pursuit? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Hilton Grand Vacations (NYSE: HGV)
Spun off from Hilton Worldwide in 2017, Hilton Grand Vacations (NYSE: HGV) is a global timeshare company that provides travel experiences for its customers through its timeshare resorts and club membership programs.
Hilton Grand Vacations reported revenues of $1.27 billion, up 2.5% year on year, falling short of analysts’ expectations by 8.1%. It was a disappointing quarter as it posted and a significant miss of analysts’ adjusted operating income estimates.
Hilton Grand Vacations delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 11% since the results and currently trades at $45.21.
Read our full analysis of Hilton Grand Vacations’s results here.
American Airlines (NASDAQ: AAL)
One of the ‘Big Four’ airlines in the US, American Airlines (NASDAQ: AAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.
American Airlines reported revenues of $14.39 billion, flat year on year. This number topped analysts’ expectations by 0.6%. More broadly, it was a slower quarter as it recorded full-year EPS guidance missing analysts’ expectations.
The stock is up 1.7% since reporting and currently trades at $12.92.
Read our full, actionable report on American Airlines here, it’s free.
Marriott (NASDAQ: MAR)
Founded by J. Willard Marriott in 1927, Marriott International (NASDAQ: MAR) is a global hospitality company with a portfolio of over 7,000 properties and 30 brands, spanning 130+ countries and territories.
Marriott reported revenues of $6.74 billion, up 4.7% year on year. This result surpassed analysts’ expectations by 1.2%. Aside from that, it was a mixed quarter as it also logged a decent beat of analysts’ EBITDA estimates but EBITDA guidance for next quarter missing analysts’ expectations.
The stock is up 3.3% since reporting and currently trades at $268.
Read our full, actionable report on Marriott here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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