Royal Caribbean Cruises Ltd. $RCL Shares Sold by Capital World Investors

Key Points

• Capital World Investors trimmed its stake in Royal Caribbean by 5.5% in Q3, selling 995,439 shares and ending the period with 16,987,565 shares (about 6.23% of RCL) valued at $5.497 billion, making RCL its 27th largest holding.
• Royal Caribbean increased its quarterly dividend to $1.50 (annualized $6.00, ~2.1% yield) and the board approved a $2.0 billion share buyback authorization (up to ~2.6% of outstanding stock).
• Insiders have been net sellers recently — Director Arne Wilhelmsen sold 356,026 shares and CEO Jason Liberty sold 90,910, with insiders offloading ~1.97 million shares worth $626.7 million last quarter — yet analysts remain broadly positive, with a consensus rating of “Moderate Buy” and a $348.29 price target.

Capital World Investors lessened its stake in Royal Caribbean Cruises Ltd. (NYSE:RCL - Free Report) by 5.5% during the third quarter, according to the company in its most recent 13F filing with the Securities & Exchange Commission. The fund owned 16,987,565 shares of the company's stock after selling 995,439 shares during the quarter. Royal Caribbean Cruises comprises approximately 0.8% of Capital World Investors' holdings, making the stock its 27th biggest holding. Capital World Investors owned approximately 6.23% of Royal Caribbean Cruises worth $5,497,069,000 at the end of the most recent reporting period.

Other institutional investors also recently made changes to their positions in the company. Evolution Wealth Management Inc. acquired a new stake in shares of Royal Caribbean Cruises during the 2nd quarter worth $31,000. GGM Financials LLC acquired a new position in Royal Caribbean Cruises in the third quarter valued at $33,000. Financial Gravity Companies Inc. purchased a new stake in Royal Caribbean Cruises during the second quarter valued at about $38,000. Dogwood Wealth Management LLC raised its holdings in shares of Royal Caribbean Cruises by 318.8% in the 3rd quarter. Dogwood Wealth Management LLC now owns 134 shares of the company's stock worth $43,000 after purchasing an additional 102 shares during the period. Finally, Physician Wealth Advisors Inc. lifted its stake in shares of Royal Caribbean Cruises by 38.1% in the 3rd quarter. Physician Wealth Advisors Inc. now owns 214 shares of the company's stock valued at $69,000 after purchasing an additional 59 shares in the last quarter. 87.53% of the stock is owned by hedge funds and other institutional investors.

Analysts Set New Price Targets

A number of analysts recently issued reports on RCL shares. Sanford C. Bernstein reissued an "outperform" rating and set a $380.00 target price on shares of Royal Caribbean Cruises in a research report on Friday, January 30th. Weiss Ratings reissued a "buy (b-)" rating on shares of Royal Caribbean Cruises in a research report on Friday, December 26th. TD Cowen reissued a "buy" rating on shares of Royal Caribbean Cruises in a research note on Tuesday, January 13th. William Blair restated an "outperform" rating on shares of Royal Caribbean Cruises in a report on Thursday, January 29th. Finally, Bank of America increased their price target on Royal Caribbean Cruises from $325.00 to $330.00 and gave the company a "neutral" rating in a report on Monday, January 12th. One equities research analyst has rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and four have assigned a Hold rating to the stock. Based on data from MarketBeat, Royal Caribbean Cruises currently has an average rating of "Moderate Buy" and a consensus price target of $348.29.

Royal Caribbean Cruises Price Performance

Shares of RCL stock opened at $290.96 on Tuesday. The firm has a fifty day simple moving average of $304.40 and a 200-day simple moving average of $301.83. The company has a market capitalization of $78.71 billion, a PE ratio of 18.64, a price-to-earnings-growth ratio of 0.91 and a beta of 1.87. Royal Caribbean Cruises Ltd. has a twelve month low of $164.01 and a twelve month high of $366.50. The company has a current ratio of 0.18, a quick ratio of 0.16 and a debt-to-equity ratio of 1.77.

Royal Caribbean Cruises (NYSE:RCL - Get Free Report) last released its quarterly earnings results on Thursday, January 29th. The company reported $2.80 earnings per share (EPS) for the quarter, hitting the consensus estimate of $2.80. Royal Caribbean Cruises had a net margin of 23.80% and a return on equity of 45.06%. The firm had revenue of $4.26 billion for the quarter, compared to the consensus estimate of $4.28 billion. During the same quarter in the previous year, the firm posted $1.63 EPS. The firm's quarterly revenue was up 13.2% on a year-over-year basis. Equities research analysts anticipate that Royal Caribbean Cruises Ltd. will post 14.9 earnings per share for the current fiscal year.

Royal Caribbean Cruises Increases Dividend

The firm also recently declared a quarterly dividend, which will be paid on Friday, April 3rd. Investors of record on Friday, March 6th will be paid a $1.50 dividend. This represents a $6.00 annualized dividend and a dividend yield of 2.1%. This is a positive change from Royal Caribbean Cruises's previous quarterly dividend of $1.00. The ex-dividend date is Friday, March 6th. Royal Caribbean Cruises's payout ratio is presently 38.44%.

Royal Caribbean Cruises declared that its board has approved a share buyback plan on Wednesday, December 10th that authorizes the company to buyback $2.00 billion in outstanding shares. This buyback authorization authorizes the company to purchase up to 2.6% of its stock through open market purchases. Stock buyback plans are often a sign that the company's board of directors believes its stock is undervalued.

Insider Activity

In other Royal Caribbean Cruises news, Director Arne Alexander Wilhelmsen sold 356,026 shares of the company's stock in a transaction that occurred on Thursday, February 26th. The stock was sold at an average price of $318.39, for a total value of $113,355,118.14. Following the transaction, the director directly owned 16,681,386 shares of the company's stock, valued at $5,311,186,488.54. This represents a 2.09% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. Also, CEO Jason T. Liberty sold 90,910 shares of the stock in a transaction that occurred on Friday, February 13th. The shares were sold at an average price of $326.81, for a total value of $29,710,297.10. Following the transaction, the chief executive officer owned 218,822 shares of the company's stock, valued at approximately $71,513,217.82. This trade represents a 29.35% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 1,967,319 shares of company stock worth $626,681,935. Insiders own 6.95% of the company's stock.

Royal Caribbean Cruises Company Profile

Royal Caribbean Cruises NYSE: RCL, operating as part of the Royal Caribbean Group, is a global cruise company that develops, markets and operates passenger cruise ships. The company operates multiple consumer-facing cruise brands that offer short- and long-duration itineraries and a range of onboard experiences. Its core activities include itineraries and voyage operations, guest services and hospitality, onboard food and beverage, entertainment and recreation programming, and the commercial activities needed to sell and support cruises through both direct and travel‑agent channels.

Royal Caribbean's ships serve a broad set of geographies worldwide, regularly deploying vessels in the Caribbean, North America (including Alaska), Europe, Asia, Australia and South America.

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