Home features Norwegian Cruise Line stock price hits a 1-year high on recovery hopes

Norwegian Cruise Line stock price hits a 1-year high on recovery hopes

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Shares of Norwegian Cruise Line Holding (NASDAQ: NCLH) are trading in an upward trajectory in recent weeks on plans to shove off this summer for the first time in over a year.

Fundamental analysis: Proposal filed

NCLH filed a proposal with the U.S. Centers for Disease Control and Prevention earlier this day, saying Norwegian Cruise ships are ready to set sail once again in July this year. The proposal included certain measures such as requiring passengers and staff to be fully vaccinated weeks before ships set sail and reduce the on-board capacity to 60%, increasing it by 20% every 30 days.


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“I challenge you to tell me of another venue anywhere that has this kind of iron-clad health and safety protocols in place … cruise ships will de facto become the safest place on earth. We want to start in the safest manner possible and that is … everybody on board has to be vaccinated,” said the company’s chief executive Frank Del Rio on Monday. 

The move comes more than a year after the CDC banned a number of ships from cruising following the coronavirus outbreak. NCLH’s revenue plummeted by 80% last year as a result of travel restrictions amid the pandemic. The company’s executives believe the cruise line operator will be able to resume operations and gradually welcome more travellers in the future.

“It’s time to get back to cruising,” Del Rio said. “I don’t want to say that I’m daring the CDC to do anything, but I want to hear any feedback that suggests that this is not the best way to come back and cruise again.”

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Technical analysis: Recovery play in motion

Norwegian Cruise Line stock price is up over 13% in March as investors continue to shift funds from high-growth stocks to more cyclical stocks that have reopening exposure. NCLH stock is now up over 300% compared to the pandemic-driven low.

NCLH monthly chart (TradingView)

Shares of the company soared to exceed the $34 mark where a major mid-term resistance line is located. This way, NCLH stock erased about 50% of pandemic-fueled losses. The price action has already rotated lower to hit levels below the $30 mark on profit-taking. 

Summary

Norwegian Cruise Line sent a proposal to the CDC, claiming the company is ready to set sail again this summer after a more than a year-long break. In the meantime, shares have soared to a 1-year high on recovery hopes.