Royal Caribbean Stock Just Hit Another 52-Week Low. Here’s How to Play RCL, And Another Cruise Stock to Consider for the Long Term.

Royal Caribbean Cruises (RCL) hit a new 52-week low on Tuesday. Now trading at its lowest point since May 2025, investors are left wondering about the cruise operator stock’s future direction. 

Yesterday’s new 52-week low of $231.03 was RCL’s 24th in the past 12 months, compared with just four new 52-week highs. The shares are down 35% since hitting its last 52-week high of $356.39 in mid-February. Its share price is clearly at a crossroads.   

Of the three major U.S.-listed publicly traded cruise operators, Royal Caribbean has always been my favorite. With Viking Holdings' (VIK) May 2024 IPO, I gained a second favourite cruising stock. Over the past 12 months, VIK has put the boots to RCL, up 61.2% on a relative basis. 

So, if cruise stocks are your thing, you do have options other than Royal Caribbean. In today’s commentary, I’ll consider three things: 1) Should you buy RCL on the new low, 2) Should you pass given it’s a falling knife, and 3) Is VIK a better option for the long haul?

Let’s dig into it. 

Should You Buy RCL at the Latest 52-Week Low?

As I said in the introduction, RCL stock hasn’t traded this low since May 2025. Over the past 20 years, its share price has ranged from a high of $366.50 on Aug. 1, 2025, to a low of $5.40 on March 1, 2009. 

The latter occurred during the Great Recession triggered by the 2008 financial crisis. By comparison, it traded around $35 at the COVID-induced March 2020 low that crushed its business. Full, or near-full, occupancy and a return to annual profitability didn’t return until Q3 2023. 

The point is: it can always be worse. 

What matters is determining whether the current low is a value play or a value trap. I’ll cover the former in this section and the latter in the next, where I discuss whether RCL stock is a falling knife. 

Let’s consider three valuation metrics: EV/revenue (income statement), net debt/EBITDA (balance sheet), and price/NTM Cash Flow per Share (cash flow statement).

RCL’s current EV/Revenue multiple is 4.59x based on the trailing 12 months ended June 30. That’s lower than at any time in the past five years, except in 2023, as the share price had yet to catch up to the improvement in its business. 

Its net debt to EBITDA is currently 3.09x, while the average of the past eight quarters -- Q3 2024 through Q2 2026 -- is 3.16x, so even though its net debt in the latest quarter was $22.69 billion, about $1.5 billion higher than Q3 2024, the 

higher EBITDA made up the difference. More importantly, it has $7.58 in EBITDA to cover every dollar of interest, about 25% more than the average over the past quarters. 

Lastly, the current multiple—based on RCL’s share price as I write this on Wednesday morning and a cash flow per share estimate for the next 12 months of $27.36, according to S&P Global Market Intelligence—is 8.59x, cheaper than at any time since Q3 2024. 

So, despite higher cruise-operating costs from inflation and the Iran war, Royal Caribbean’s business is growing on the top and bottom lines, while maintaining a very healthy balance sheet.

It might not be historically cheap, but it’s definitely not expensive at current prices. A 3-5-year hold should do very well. 

Watch Out for the Falling Knife

Newton’s Law states that an object in motion tends to stay in motion unless an outside force disrupts it. The Barchart Technical Opinion is a 72% Strong Sell. If you believe in technical analysis, RCL’s share price looks as though it will keep falling. 

That said, its 14-day relative strength is 18.61; anything below 30 is considered oversold. The share price is most definitely at a crossroads. 

Of the 26 analysts covering RCL, 18 rate it a Buy (4.35 out of 5), with a $352.15 target price, 55% higher than its current share price. These same analysts forecast 2026 EPS of $17.78, up 13.7% from a year ago, and 2027 EPS of $20.12, up 13.2% from 2026. These are not the numbers of a faulty business model.

However, the company announced this morning that it is buying 50% of Sandals Resorts for $3 billion (10 times EBITDA). It will finance most of the investment with new debt, which should increase its net debt by about 10% to around $25 billion. The shares are down 3% on the news. 

For the next little while, I don’t think there’s any question that the bulls and bears will battle it out over the strategic sense of such a move. 

I’ve always respected Royal Caribbean’s management. They clearly want to gain a bigger piece of the $2 trillion global vacation market by offering land-and-sea packages to both customer demographics. 

The investment will deliver $300 million in annual EBITDA profits in the first full year post-closing. Meanwhile, Sandals will gain further expansion capital to grow its resort business. 

Volatility will likely pick up in the near term. I wouldn’t say the losses over the last couple of days mean the shares confirm a falling knife. 

Royal Caribbean faces some challenges, but nothing that justifies the overcorrection over the past month. 

Is VIK a Better Buy for the Long Term?

Analysts are slightly more enthusiastic about Viking than RCL. Of the 19 covering VIK, 15 rate it a Buy (4.47 out of 5), with a $110.53 target price, 37% higher than its current share price. 

Analysts expect it to earn $3.20 a share in 2026, up 22.6% from 2025, and $4.39 in 2027, up 37.2% from 2026. Based on the 2027 estimate, its share price is 18.5 times that forecast. Meanwhile, RCL’s current share price is 11.3 times the analysts’ 2027 forecast. 

Investors are currently willing to pay more for the luxury ocean and river cruise operator. How long will this last? It could last for years. 

In Q2 2026, Viking reported a $645 net yield—the profit per passenger day—compared to $289 for Royal Caribbean. More importantly, Viking gets most of that yield before passengers embark. About 40% of Royal Caribbean’s passenger revenue is generated onboard. It’s not a given.

You can make a case for owning both stocks over the long haul. 

Viking has only been a public company for 30 months, but in that time its shares have gained 238%; RCL stock is up 65%. Clearly, Viking’s luxury story resonates better with investors. It has to do less to make more per passenger. 

The choice between them depends on why you’re thinking of investing in the first place. If you believe that Viking’s demographic is somewhat immune to economic headwinds—that is, its pricing power is much greater than Royal Caribbean’s—then you’re better off with VIK.

However, if you are like me and believe that Royal Caribbean continues to provide the best value for travelers looking for a week or two away, RCL is the better bet. 

From a valuation perspective, there’s no question RCL is the better deal. Does that make it the better long-term hold? Maybe. Maybe not. 

If you can, I’d consider buying both. Their respective target markets don’t overlap as much as you might think. In my opinion, they’re both attractive long-term buys.

On the date of publication, Will Ashworth did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.