NEW YORK (TheStreet) -- Shares of Royal Caribbean Cruises (RCL) closed up 6.62% at $81.84 on Wednesday as the Miami-based cruise line gained after the U.S. government said it was moving to normalize diplomatic relations with Cuba.
President Obama held a press conference today saying that he instructed Secretary of State John Kerry to immediately begin discussions to reestablish relations with the country while also announcing plans to open an embassy there.
Investors are looking forward to Royal Caribbean Cruises and other cruise lines offering Cuban destinations now that it looks like the travel restrictions to the country will be lifted soon.
In the coming weeks, travel to the country will ease in 12 existing categories, including family visits and certain export activities, according to CNBC.
Shares of Royal Caribbean traded with heavy volume today, with about 5.28 million shares changing hands by the market close, compared to the average of 3.64 million shares.
Separately, TheStreet Ratings team rates ROYAL CARIBBEAN CRUISES LTD as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation:
"We rate ROYAL CARIBBEAN CRUISES LTD (RCL) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 9.3%. Since the same quarter one year prior, revenues slightly increased by 3.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 32.72% and other important driving factors, this stock has surged by 79.54% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
- ROYAL CARIBBEAN CRUISES LTD has improved earnings per share by 32.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, ROYAL CARIBBEAN CRUISES LTD increased its bottom line by earning $2.14 versus $0.07 in the prior year. This year, the market expects an improvement in earnings ($3.46 versus $2.14).
- The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Hotels, Restaurants & Leisure industry average. The net income increased by 34.0% when compared to the same quarter one year prior, rising from $365.70 million to $490.25 million.
- You can view the full analysis from the report here: RCL Ratings Report