Finance
Why Norwegian Cruise Line Stock Dropped Today
Norwegian Cruise Line Holdings (NYSE: NCLH) tumbled 8.5% through 10:35 a.m. ET after reporting mixed earnings — and lousy guidance — this morning.
Heading into the report, Wall Street analysts expected Norwegian to earn $0.15 per share on sales of $2.36 billion. The cruise line stock managed to beat the earnings forecast, earning $0.23, but it hit shoals on sales, coming up just short at $2.33 billion.
Image source: Getty Images.
Norwegian Cruise stock may be at the mercy of U.S.-Iran peace negotiations for a while.
Norwegian Cruise Line Holdings (NCLH 7.76%) tumbled 8.5% through 10:35 a.m. ET after reporting mixed earnings — and lousy guidance — this morning.
Heading into the report, Wall Street analysts expected Norwegian to earn $0.15 per share on sales of $2.36 billion. The cruise line stock managed to beat the earnings forecast, earning $0.23, but it hit shoals on sales, coming up just short at $2.33 billion.
Image source: Getty Images.
Norwegian Cruise Q1 earnings
Sales may have missed estimates, but Norwegian still grew them 10% year over year. Earnings of positive $0.23 per share completely flipped the script on last year’s Q1 loss of $0.09 per share, as Norwegian worked hard to cut about $125 million in annual “long-term structural” costs.
These should be permanent savings that will boost Norwegian’s profits in future years — but future years aren’t what investors are worrying about. Rather, they’re worried about the Iran War, the Strait of Hormuz, and the prospect of $150 oil in the near future.
And all three are already having an effect on Norwegian’s near-term business.
Norwegian Cruise Line
Today’s Change
(-7.76%) $-1.46
Current Price
$17.35
What’s next for Norwegian Cruise stock
Citing rising oil prices and higher fuel costs for its ships, Norwegian slashed its 2026 earnings forecast. Non-GAAP earnings per share will probably range from $1.45 to $1.79, versus the $2.12 per share that Wall Street was hoping for. Worse, according to Norwegian, every 1% rise in the cost of fuel for its ships as the Iran war-slash-embargo-blockade drags on could cost the company an additional $0.09 per share in lost profit.
Granted, if the Iran conflict ends early and oil prices fall, every 1% change in fuel prices will add $0.09. But it’s the downside risk investors are focused on today.