The sea is not calm for Norwegian Cruise Line
Over the last three and a half months, Norwegian Cruise Line Holdings (NYSE: NCLH) has been struggling a bit, or at least its stock has. After peaking in early May, the stock has underperformed the overall market and a trend channel has formed that defines the various cycles within the overall trend. The stock hit the upper rail of the channel on August 13 before turning lower the next day. The downward momentum has been strong enough that the 50-day moving average crossed bearishly below the 200-day in early August.
We see on the chart that the upper rail connects the highs from May, July 1, and now August 13. It is also worth noting that the 50-day moving average and the upper rail are right on top of one another. This could provide a dual layer of resistance that the stock has to break through in order to move higher.
The daily stochastic readings are in overbought territory at this time and they performed a bearish crossover on August 14. In addition to this potential bearish sign, the Tickeron Trend Prediction Engine generated a bearish signal on Norwegian Cruise Line on August 13. The signal calls for a decline of at least 4% within the next month. It showed a confidence level of 89% and past predictions on the stock have been accurate 70% of the time.
Turning our attention to the fundamentals for Norwegian Cruise Line, the company seems to be average in most categories, but there are a few that are below average. The Tickeron SMR rating for this company is 61, indicating slightly weaker than average sales and a marginally profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
That SMR rating is mostly being impacted by the sales growth rate as much as anything. The company has seen sales grow at a rate of 11% per year over the last three years and they grew by 9% in the most recent quarterly report. The return on equity is at 18.9% right now and the profit margin is at 18.5%.
Earnings have been growing at a solid pace over the last three years, but have slowed a little recently and are expected to slow this year. The average annual growth rate has been 20%, but the most recent quarterly report showed earnings growth of only 7%. Analysts expect earnings to grow at a much more modest 4% for 2019 as a whole.
Despite what seems to be a shift in the fundamentals and the downward trend on the chart, the sentiment toward Norwegian Cruise Line is extremely bullish. There are 18 analysts following the stock at this time and 16 of them have the stock rated as a “buy” and two have it rated as a “hold”. This puts the overall buy percentage at 88.9% and that is above the average buy rating.
The short interest ratio for the stock is currently at 2.6 and that is below the average short interest ratio. The number of shares sold short dropped from 6.28 million to 6.09 million from the mid-July reading to the end of July. This is a sign that the sentiment became more bullish during that stretch.
While the fundamentals for Norwegian Cruise Line aren’t terrible, the momentum on the chart is to the downside and the sentiment being skewed to the optimistic side won’t help the stock if it continues to fall.
NCLH in upward trend: price expected to rise as it breaks its lower Bollinger Band on February 28, 2025
NCLH may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options. In of 32 cases where NCLH's price broke its lower Bollinger Band, its price rose further in the following month. The odds of a continued upward trend are .
Technical Analysis (Indicators)
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where NCLH's RSI Indicator exited the oversold zone, of 23 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are .
The Moving Average Convergence Divergence (MACD) for NCLH just turned positive on March 20, 2025. Looking at past instances where NCLH's MACD turned positive, the stock continued to rise in of 41 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where NCLH advanced for three days, in of 299 cases, the price rose further within the following month. The odds of a continued upward trend are .
Bearish Trend Analysis
The Stochastic Oscillator may be shifting from an upward trend to a downward trend. In of 65 cases where NCLH's Stochastic Oscillator exited the overbought zone, the price fell further within the following month. The odds of a continued downward trend are .
The Momentum Indicator moved below the 0 level on March 28, 2025. You may want to consider selling the stock, shorting the stock, or exploring put options on NCLH as a result. In of 83 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where NCLH declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
The Aroon Indicator for NCLH entered a downward trend on March 20, 2025. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (29.674) is normal, around the industry mean (13.366). P/E Ratio (53.692) is within average values for comparable stocks, (56.479). Projected Growth (PEG Ratio) (0.453) is also within normal values, averaging (1.802). Dividend Yield (0.000) settles around the average of (0.053) among similar stocks. P/S Ratio (1.047) is also within normal values, averaging (23.253).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating fairly steady price growth. NCLH’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. NCLH’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 83, placing this stock worse than average.
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General Information
an operator of deep sea and flagged cruise ships in the travel industry
Industry OtherConsumerServices