Norwegian Cruise Line Stock Near Crucial Support – Buy Signal?
Norwegian Cruise Line (NCLH) stock should be on your watchlist. Here is why – it is currently trading in the support zone ($17.85 – $19.73), levels from which it has bounced meaningfully before. In the last 10 years, Norwegian Cruise Line stock received buying interest at this level 6 times and subsequently went on to generate 31.6% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 6/5/2020 | 19.8% | 3 |
| 11/9/2020 | 30.9% | 29 |
| 2/1/2021 | 50.5% | 127 |
| 8/3/2021 | 24.7% | 94 |
| 9/26/2024 | 37.9% | 126 |
| 7/2/2025 | 26.1% | 71 |
Should you buy one stock you like or build a portfolio designed to win across cycles? Our numbers show that High Quality Portfolio has turned stock-picking uncertainty into market-beating consistency. This portfolio is incorporated in asset allocation strategy of Trefis’ Boston-based, wealth management partner – whose asset allocation framework yielded positive returns during the 2008-09 period when the S&P lost more than 40%.
Here are some quick data points for Norwegian Cruise Line that should help decision:
- Revenue Growth: 5.2% LTM and 79.0% last 3 year average.
- Cash Generation: Nearly -5.3% free cash flow margin and 16.0% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in last 3 years for NCLH was 5.2%.
- Valuation: NCLH stock trades at a PE multiple of 11.7
For quick background, Norwegian Cruise Line provides cruise vacations with a fleet of 28 ships and 59,150 berths, distributing through retail, travel advisors, and onboard sales channels.
| NCLH | S&P Median | |
|---|---|---|
| Sector | Consumer Discretionary | – |
| Industry | Hotels, Resorts & Cruise Lines | – |
| PE Ratio | 11.7 | 23.7 |
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| LTM* Revenue Growth | 5.2% | 5.6% |
| 3Y Average Annual Revenue Growth | 79.0% | 5.3% |
| Min Annual Revenue Growth Last 3Y | 5.2% | -0.0% |
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| LTM* Operating Margin | 16.0% | 18.8% |
| 3Y Average Operating Margin | 8.9% | 18.2% |
| LTM* Free Cash Flow Margin | -5.3% | 13.4% |
*LTM: Last Twelve Months
What Is Stock-Specific Risk If The Market Crashes?
NCLH isn’t immune to big drops. It fell about 35% in the 2018 correction, crashed nearly 87% during the Covid pandemic, and dropped almost 70% in the inflation shock. Even with strong fundamentals, the stock can take major hits when the market turns sour. It shows that no matter the tailwinds, downside risk remains real.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read NCLH Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.