My aunt Mildred, who’s spent approximately the last decade perfecting the art of the all-inclusive buffet, called the other day. She’s booked a Mediterranean cruise, naturally, and was concerned. Not about the geopolitical implications of sailing through potentially contested waters, mind you, but whether they’d still have her preferred brand of decaf. Which got me thinking. Everyone’s fixated on oil prices, the Strait of Hormuz, and the general air of impending doom. And, yes, that’s all…a thing. But it feels disproportionate. Like getting upset about a chipped teacup while the house is slowly sinking. Which, in a metaphorical sense, is what the market seems to be doing with cruise line stocks.
I’ve been quietly accumulating shares in a few of these companies – Royal Caribbean (RCL +2.27%) and Viking Holdings (VIK +0.71%) mostly – and the recent wobble feels…opportunistic. Not because I have any particular fondness for shuffleboard or themed nights, but because the panic feels overblown. I mean, people want to go on cruises. They really do. Even when gas is ridiculous, even when the news is terrifying. Mildred, bless her, is proof of that. And demand, as anyone who’s tried to book a cabin recently knows, is exceeding supply. Which, in the world of economics, is a pretty good position to be in, even if you’re dodging potential pirate activity.
The oil thing, though. It’s a good distraction. It allows everyone to clutch their pearls and talk about “macroeconomic headwinds” without actually considering the underlying business. The truth is, these cruise lines have been through worse. The pandemic, for instance. That was a genuine catastrophe. They were essentially shut down, saddled with debt, and forced to beg for bailouts. Now, they’re not exactly flush with cash, but they’ve been steadily chipping away at those debts, refinancing at lower rates. It’s a slow process, like trying to untangle a ball of Christmas lights, but they’re making progress. And building more ships. Because, again, people want to cruise. It’s a deeply illogical desire, but it exists. And it’s surprisingly resilient.
Valuations are also looking…reasonable. Carnival Corp (CCL +0.21%) is trading at a P/E ratio that wouldn’t scare a sensible investor. Compared to the S&P 500 average of 29, they’re practically giving shares away. Which, let’s be honest, is probably what they’re doing. They’re desperate to attract capital. But desperation, in this case, is an opportunity. It’s like finding a perfectly good sweater at a thrift store. It might be slightly faded, but it’s a bargain. And it’ll keep you warm. Or, in this case, potentially provide a decent return on investment.
Look, I’m not saying these stocks are a sure thing. The world is a chaotic place, and anything can happen. A rogue wave could capsize the entire industry. But I suspect the current dip is a temporary overreaction. A chance to buy a solid business at a discounted price. And frankly, I’d rather put my money in something that actually does something – takes people on vacations, employs thousands of workers – than in another tech startup promising to disrupt the disruption of disruption. Plus, I’m hoping to get a discount on a cabin for Mildred. She’s already started planning her outfits.
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2026-03-15 11:22