What happened
If you own cruise line stocks, chances are you're having a pretty good day today. Around 1:10 p.m. EST on Thursday, Carnival (CCL 2.30%) stock was up 5.2% and Royal Caribbean (RCL 2.00%) was 5.6% higher, while Norwegian Cruise Line Holdings (NCLH 0.81%) shares were booking a 7.1% gain.
Image source: Getty Images.
So what
It's not entirely clear why the entire sector is surging. Carnival announced this morning that its Holland America brand has opened bookings for cruises to and from Europe for 2022. To encourage customers to sign over their discretionary dollars early, Carnival is offering $2,300 in incentives, and it has cut the required deposit amount in half. Still, announcing cruises more than a year away seems a strange reason for bidding up Carnival shares today.
Royal Caribbean announced it's sending its Grandeur of the Seas to Barbados, where it will offer one- and two-week sailings around the Caribbean next winter. Again, that's good news that's quite a ways off.
Now what
In short, there seems to be little in the way of immediate catalysts driving cruise stocks higher today. The good news is that even if Royal Caribbean doesn't get much cruising done before Christmas rolls around again, and even if Carnival doesn't get things rolling before 2022, then my latest tally of cash reserves at the cruise lines suggests those two companies, at least, have enough money to ride out the tail end of this pandemic, and emerge solvent on the other end.
That prospect alone seems to be the reason investors are feeling optimistic today.
