While the travel industry shows signs of growth, Royal Caribbean Cruises Ltd. (RCL) could find the post-pandemic world hard to navigate due to its lack of profitability. RCL’s trailing-12-month gross profit margin and EBITDA margin of 26.87% and 7.13% are 23.5% and 37.6% lower than the industry averages of 35.11% and 11.43%, respectively. Its net income margin of -24.39% compares to the industry average of 4.43%.
In terms of its forward EV/Sales, RCL is trading at 2.90x, 161.8% higher than the industry average of 1.11x. Its forward Price/Book multiple of 4.62 is 87.2% higher than the industry average of 2.47. Therefore, this travel stock might be best avoided at this time.
