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Cruise Stocks - bargain hunting! CCL; NCLH; RCL

Discussion in 'International Markets' started by SensibleInvesting, Mar 14, 2020.

  1. SensibleInvesting

    SensibleInvesting

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    If you've been watching cruise stocks, now may be a tempting time to jump in - Carnival, Royal Caribbean and Norwegian are at or under 10-year lows! Will they survive a challenging 2020/2021 or go bust? Let's answer this question and more in today's video:
     
  2. galumay

    galumay learner

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    The question for me would be, are these businesses I would want to own in a world without Corona Virus, and the answer is a simple no. Very capital intensive, lots of risks to profits, not in my wheelhouse either, to coin a phrase.
     
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  3. SensibleInvesting

    SensibleInvesting

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    Yes, well said. These are very binary stocks IMO - it's either boom or bust. I think at these price levels they provide good value, but PVH and GIII have fallen about as much as they have, and these guys own the rights to Calvin Klein, Tommy, etc. - lots of bargains at low prices these days!
     
  4. Dona Ferentes

    Dona Ferentes

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    Give them a wide berth.
     
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  5. MrChow

    MrChow

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    Hey I actually enjoyed watching this!

    I agree there are probably better stocks at under 10 trailing PE in terms of solvency risk that have been similarly affected:

    - FLT, WEB, CTD (travel stocks no net debt)
    - AKG, RDH (education stocks no net debt)
    - WBC, NAB (banks with close to double their capital buffer since GFC)
     
    Last edited: Mar 14, 2020
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  6. SensibleInvesting

    SensibleInvesting

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    Good watch list - FLT, WEB, and CTD have definitely been slaughtered. What's your entry price for WEB? They would make a lovely little tuck in acquisition for someone bigger like a QAN (if they don't go broke!).

    I'm also looking at PVH in the USA - great company, great brands!
     
  7. finicky

    finicky

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    QUOTE MrChow
    "I agree there are probably better stocks at under 10 trailing PE in terms of solvency risk that have been similarly affected:
    - FLT, WEB, CTD (travel stocks no net debt)"

    Haven't looked at the others but it appears that WEB has long term debt amounting to 23% of its capital as at end of fy19.
    Additionally it is a provider of trade credit (receivables) which is substantial. Also its payables exceed its receivables although it does have substantial cash. My source for this is Comsec company financials.
    The trade credit (receivables) is something for potential buyers of WEB to be wary of since as Claude Walker says, "WEB is a creditor to a large number of travel agents and tour operators and may have trouble collecting all these debts, as some will likely go bankrupt."
     
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  8. qldfrog

    qldfrog

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    Out of these 3,we would be lucky to have flt still up in a year, remember you do not even need them and can book directly on the airline site
    If flying in the coming months, i would book direct and remove one collapse risk in the process
     
  9. SensibleInvesting

    SensibleInvesting

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    Thank you for the insight!
     
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