Those who invested in Norwegian Cruise Line Holdings (NYSE:NCLH) a year ago are up 86%

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These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But if you pick the right individual stocks, you could make more than that. For example, the Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) share price is up 86% in the last 1 year, clearly besting the market return of around 31% (not including dividends). That's a solid performance by our standards! Having said that, the longer term returns aren't so impressive, with stock gaining just 18% in three years.

Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.

Check out our latest analysis for Norwegian Cruise Line Holdings

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

Norwegian Cruise Line Holdings went from making a loss to reporting a profit, in the last year.

When a company has just transitioned to profitability, earnings per share growth is not always the best way to look at the share price action.

We think that the revenue growth of 16% could have some investors interested. We do see some companies suppress earnings in order to accelerate revenue growth.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
NYSE:NCLH Earnings and Revenue Growth November 22nd 2024

It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. So it makes a lot of sense to check out what analysts think Norwegian Cruise Line Holdings will earn in the future (free profit forecasts).

A Different Perspective

We're pleased to report that Norwegian Cruise Line Holdings shareholders have received a total shareholder return of 86% over one year. Notably the five-year annualised TSR loss of 9% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We've spotted 3 warning signs for Norwegian Cruise Line Holdings you should be aware of, and 1 of them is a bit unpleasant.

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