Loop Capital upgraded Norwegian Cruise Line (NYSE:NCLH) to Buy from Hold, holding its price target steady at $25. The firm points to a compelling entry point after a roughly 40% drop in the stock year-to-date, noting the shares now trade at an attractive discount based on discounted cash flow valuations.
Analysts are broadly optimistic about the cruise sector, viewing it as well-positioned to gain market share even in a downturn. Norwegian’s pricing—typically around 30% lower than comparable land-based vacations—adds to its recession-resistant appeal.
The upgrade also follows a recent christening voyage of Norwegian’s newest ship, Aqua, part of its first Prima Plus class. The ship is 10% larger than its predecessors and expected to accommodate nearly 4,000 guests. Its modern design is seen as a strong fit for Norwegian’s core customer base and could command premium pricing relative to the rest of the fleet.
Further supporting the long-term growth narrative, Norwegian is making strategic investments in its private island destination, Great Stirrup Cay, including a new pier and additional amenities aimed at enhancing the guest experience.