Posted on 06/30/2022 4:06:14 PM PDT by Capt. Tom
The market's view of these travel and leisure companies is growing more pessimistic. What happened The terrible week for cruise line stocks continued on Thursday. Not only is the broader market's decline dragging down their share prices, but there are also fears that the companies are seeing pricing pressure for tickets.
So what On Wednesday, Morgan Stanley analyst Jamie Rollo said in a report that he was worried that cruise line companies could ultimately face insolvency if their business conditions don't improve soon. And on Thursday, Citi leisure and travel sector analyst James Hardiman said during an interview on Yahoo! Finance Live that cruise companies are facing "some pushback on pricing," especially as ships get closer to operating at full capacity.
At the same time, operators are facing higher expenses due to rising labor costs, high fuel prices, and rising interest rates. So it's understandable that the market is skeptical about their futures.
When the broader market falls, as it did in early trading Thursday, high volatility stocks tend to take more exaggerated tumbles. That's another piece of what we're seeing here.
Now what There's a lot of noise in the market Thursday and it's hard to decipher what's real and what's not. But I think it's clear that all the players in the cruise industry will face some serious challenges over the next year.
It's possible that the U.S. economy is already in a recession, and with inflation at a 40-year high, pressures could persist for cruise lines on both the revenue and expense fronts. That's not good, because these companies are already burning cash and have high debt loads.
The market seems to be realizing that the future looks pretty bleak for cruise lines, and that it would take a massive economic recovery to change that outlook. I don't anticipate the macroeconomic picture will get significantly better in the next few quarters, so it may be years before we see these companies generating positive cash flow.
By the time they recover, it's entirely possible that they'll have to restructure their debts. And downward spirals can happen when borrowing costs rise as stock prices fall, leaving companies paying higher costs to raise the funds they require to run their businesses. If a company can't get to positive cash flow and pay down debt, it can wind up in real trouble. I think we're there with cruise lines, and the market may be realizing the same thing.
They will drop the whole program. Almost nobody is dying of or afraid of COVID anymore
[And by the way me and my wife have zero adverse effects from the jabs and never caught covid.]
I was at the doctor’s office earlier this week. She told us they are getting a lot of people positive for COVID, and they are all vaccinated.
On all 5 cruises (MSC, Carnival & RCCL) never heard a single incidence of anyone catching the bug. There were no quarantines and no restrictions. I do not ever remember ships only half full during my 41 previous cruises where it was always lines at buffet, to get inside the theater, and especially during disembarking. These 5 cruises since September 2021 were uncrowded, no lines anywhere, the staff were going the extra mile to please the passengers, and the price of cruises were amazing bargains.
I am 100 times more afraid of going on a flight longer than 30 minutes than a 4 or 5 day cruise. In an aircraft people sit shoulder to shoulder and everyone is exhaling in a common airspace. Before that air reaches filters, many others will have inhaled the same air. On a cruise ship there is like 1000 times for air space for each passenger.
Coming soon, Pureblood Only Cruises.
[On all 5 cruises (MSC, Carnival & RCCL) never heard a single incidence of anyone catching the bug. There were no quarantines and no restrictions. I do not ever remember ships only half full during my 41 previous cruises where it was always lines at buffet, to get inside the theater, and especially during disembarking. These 5 cruises since September 2021 were uncrowded, no lines anywhere, the staff were going the extra mile to please the passengers, and the price of cruises were amazing bargains.
I am 100 times more afraid of going on a flight longer than 30 minutes than a 4 or 5 day cruise. In an aircraft people sit shoulder to shoulder and everyone is exhaling in a common airspace. Before that air reaches filters, many others will have inhaled the same air. On a cruise ship there is like 1000 times for air space for each passenger.]
With 270 Million Americans already vaccinated, there are few people left to get infection who are not vaccinated.
Amazing that people still believe vaccines “prevent” infections. Have you heard of any vaccine constructing a virus proof filter in nose to prevent inhaling virus floating in air near you? These viruses lodge inside the respiratory tract and do not go on vacation. They start replicating immediately using body tissue for resource.
The only function of vaccines is to stock up the body with additional tools such as anti-bodies for the particular signature of the virus. Those are deployed AFTER the infection has already begun.
Many times the virus gets killed off before any symptoms appear. That gives the low information false impression that the vaccine “prevented” infection.
My own experience with one of the best vaccines ever created, which eradicated smallpox from the entire globe was the same. I was vaccinated in elementary school. 2 or 3 years later I got infected with smallpox which has like 30%+ mortality rate (covid in comparison is barely over 1%). But the vaccine helped me recover and I am still healthy 72 years later.
-PJ
All of the ships operated or planned to be operated by this company were part of the Jones Act trade so were required to be built in a US shipyard and crewed by American citizens.
Norwegian Cruise Lines is operating The Pride of America solely in the Hawaiian trade. So, before the Pride of America began crusing in Hawaii, passengers may have shifted to other routes not soley in US waters. Other cruise line companies certainly picked up some of those passengers that wanted to cruise.
[All of the ships operated or planned to be operated by this company were part of the Jones Act trade so were required to be built in a US shipyard and crewed by American citizens.
Norwegian Cruise Lines is operating The Pride of America solely in the Hawaiian trade. So, before the Pride of America began crusing in Hawaii, passengers may have shifted to other routes not soley in US waters. Other cruise line companies certainly picked up some of those passengers that wanted to cruise.]
Let’ just say “elastic demand”. I really worry about the travel/tourism industry.
Will they be wiped out, especially when people can’t move freely when then are in electric vehicles, or worse, can’t go out of town?
When airlines are no longer reliable transportation?
Will fun destinations survive so we can go on vacation?
Folks, for those of you in tourist areas, port towns that rely on cruises, ski resort villages, it’s going to be bad.
And yet the Emergency Use Authorizations for all 3 COVID vaccines were based on claims they prevent COVID infections.
fyi
There was the iceberg ship this week, the Norwegian Sun. Hit some floating debris and panicked in Alaskan waters. It made a beeline for Juneau for diver inspections. Then hit to open waters back to Seattle to off load passengers at end of cruise. It was due back June 30th. One June 29th as it passed Victoria, it made the detour to the Canadian city, even though it was a troubled-ship. Seems like a violation of US law would have occurred if it missed the one foreign port on the journey.
Can anyone correct me or shed light on that?
Just a general observation, in some situations such as the saftey of the vessel, passengers, and crew are involved, the foreign port rule may be waved.
I thought that too. But “going straight back to Seattle” was cited, skipping two other stops.
Maybe the alert was being downgraded and not stopping at Victoria would have left much more red tape or fines in the end.
It looks to me right now that those people who got the boosters are in more danger of contracting the virus than an unvaccinated person. - Tom
That’s because the un-vaxxed are selfish. /s
Ye4p thats me
My body My choice My veins
Bureaucrats will fling all sort of crap at the public. We gotta be smarter and better informed to separate the wheat from the chaff.
Move to Florida if possible and skip all flights.
I did and can drive to Cape Canaveral in 90-100 minutes.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.