Norwegian Cruise (NCLH) To Post Q4 Earnings: What's In Store?

Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) is scheduled to report fourth-quarter 2019 results on Feb 20. In the last reported quarter, the company delivered a positive earnings surprise of 3.8%.

Q4 Expectations

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 70 cents, indicating a decline of 17.7% from the year-ago quarter. The same for revenues stands at $1,431 million, suggesting growth of 3.9% from the prior-year reported figure.

Factors at Play

Robust passenger ticket and onboard and other revenues are likely to have driven Norwegian Cruise fourth-quarter performance. Moreover, strong demand and modest capacity growth are likely to get reflected in the to-be-reported quarter’s results. Higher yield and fleet-expansion efforts have been enabling the company to gain traction.

The Zacks Consensus Estimate for passenger ticket revenues stands at $983 million, suggesting growth of 2.6% from the year-ago quarter. The same for onboard and other revenues is pegged at $451 million, indicating an improvement of 6.6% from the prior-year reported figure.

However, the fourth-quarter bottom line is likely to reflect increase in fuel costs and net cruise costs and Trump’s travel ban to Cuba. The company expects net cruise costs (excluding Fuel per Capacity Day) to be 2.25% in constant currency. Trump administration's policy change on travel to Cuba is likely to have affected the company’s earnings by 35-45 cents in 2019. Moreover, the company may have been exposed to foreign- exchange related risks as it operates globally.

Norwegian Cruise Line Holdings Ltd. Price and EPS Surprise

What Does the Zacks Model Unveil

Our proven model does not conclusively predict an earnings beat for Norwegian Cruise this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Norwegian Cruise has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks Poised to Beat Earnings Estimates

Here are some stocks from the Consumer Discretionary sector that investors may consider as our model shows that these have the right combination of elements to come up with an earnings beat in the to-be-reported quarter:

WW International, Inc. (NASDAQ:WW) has a Zacks Rank #2 and an Earnings ESP of +15.33%.

G-III Apparel Group, Ltd. (NASDAQ:GIII) has a Zacks Rank #2 and an Earnings ESP of +5.62%.

Casa Systems, Inc. (NASDAQ:CASA) has a Zacks Rank #2 and an Earnings ESP of +83.34%.

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