Travel and Vacation Providers Stocks Q3 Recap: Benchmarking Royal Caribbean (NYSE:RCL)

January 08, 2025 at 04:04 AM EST

RCL Cover Image

Looking back on travel and vacation providers stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Royal Caribbean (NYSE: RCL) and its peers.

Airlines, hotels, resorts, and cruise line companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted from buying "things" (wasteful) to buying "experiences" (memorable). In addition, the internet has introduced new ways of approaching leisure and lodging such as booking homes and longer-term accommodations. Traditional airlines, hotel, resorts, and cruise line companies must innovate to stay relevant in a market rife with innovation.

The 17 travel and vacation providers stocks we track reported a satisfactory Q3. As a group, revenues beat analysts’ consensus estimates by 1.1% while next quarter’s revenue guidance was 0.9% below.

Luckily, travel and vacation providers stocks have performed well with share prices up 12.4% on average since the latest earnings results.

Royal Caribbean (NYSE: RCL)

Established in 1968, Royal Caribbean Cruises (NYSE: RCL) is a global cruise vacation company renowned for its innovative and exciting cruise experiences.

Royal Caribbean reported revenues of $4.89 billion, up 17.4% year on year. This print was in line with analysts’ expectations, but overall, it was a mixed quarter for the company with a decent beat of analysts’ adjusted operating income estimates but EPS guidance for next quarter missing analysts’ expectations.

"Our exceptional third quarter results and increased full year expectations reflect the robust demand for our differentiated vacation experiences," said Jason Liberty, president and CEO, Royal Caribbean Group.

Interestingly, the stock is up 10.6% since reporting and currently trades at $225.30.

Read our full report on Royal Caribbean here, it’s free.

Best Q3: Target Hospitality (NASDAQ: TH)

Building mini-communities at places such as oil drilling sites, Target Hospitality (NASDAQ: TH) is a provider of specialty workforce lodging accommodations and services.

Target Hospitality reported revenues of $95.19 million, down 34.8% year on year, outperforming analysts’ expectations by 8.3%. The business had a very strong quarter with a solid beat of analysts’ EPS estimates.

Target Hospitality achieved the biggest analyst estimates beat and highest full-year guidance raise among its peers. The market seems content with the results as the stock is up 1.1% since reporting. It currently trades at $9.30.

Is now the time to buy Target Hospitality? Access our full analysis of the earnings results here, it’s free.

Slowest Q3: Soho House (NYSE: SHCO)

Boasting fancy locations in hubs such as NYC and Miami, Soho House (NYSE: SHCO) is a global hospitality brand offering exclusive private member clubs, hotels, and restaurants.

Soho House reported revenues of $333.4 million, up 13.6% year on year, in line with analysts’ expectations. It was a slower quarter as it posted a miss of analysts’ members estimates and full-year EBITDA guidance missing analysts’ expectations significantly.

Soho House delivered the weakest full-year guidance update in the group. Interestingly, the stock is up 55.7% since the results and currently trades at $7.66.

Read our full analysis of Soho House’s results here.

Wyndham (NYSE: WH)

Established in 1981, Wyndham (NYSE: WH) is a global hotel franchising company with over 9,000 hotels across nearly 95 countries on six continents.

Wyndham reported revenues of $396 million, down 1.5% year on year. This print lagged analysts' expectations by 3%. It was a slower quarter as it also recorded a miss of analysts’ adjusted operating income estimates.

Wyndham had the weakest performance against analyst estimates among its peers. The stock is up 23.3% since reporting and currently trades at $100.32.

Read our full, actionable report on Wyndham here, it’s free.

Delta Air Lines (NYSE: DAL)

One of the ‘Big Four’ airlines in the US, Delta Air Lines (NYSE: DAL) is a major global air carrier that serves both business and leisure travelers through its domestic and international flights.

Delta Air Lines reported revenues of $15.68 billion, up 7.7% year on year. This number surpassed analysts’ expectations by 2.5%. Zooming out, it was a mixed quarter as it also produced an impressive beat of analysts’ EPS estimates but a miss of analysts’ EBITDA estimates.

The stock is up 20.8% since reporting and currently trades at $61.63.

Read our full, actionable report on Delta Air Lines here, it’s free.

Market Update

Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.

Want to invest in winners with rock-solid fundamentals? Check out our Strong Momentum Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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