Lindblad Expeditions (LIND -4.18%) enjoyed its biggest-ever booking day earlier this year, eclipsing the previous one-day record by a whopping 14%. The New York City-based company thrills guests with once-in-a-lifetime voyages to the most remote parts of the planet.

According to Chief Commercial Officer Noah Brodsky, "Adventure travel is proving to be the break-out travel trend of the decade." Not to mention the company just posted its first positive operating income in 10 quarters. So is it time to buy this small-cap cruise stock? Let's take a closer look at Lindblad's recent developments.

Growing demand for adventure travel

Lindblad Expeditions reported 43% higher revenue last quarter than the same period in pre-pandemic 2019, the baseline year cruise companies compare current results to since COVID-19 hit. As for year-over-year improvement, the third quarter's nearly $145 million in sales marked a 100%-plus increase over Q3 of 2021.

While revenue surged last quarter, occupancy was remarkably lower than 2019 levels. Q3 2022 occupancy landed at just 81%, while in the comparable period of 2019 it reached 94%. Impressively enough, however, Lindblad was able to earn 43% more revenue at 13% lower occupancy. The revenue potential appears massive, especially if Lindblad carries more passengers in upcoming quarters.

As Chief Financial Officer Craig Felenstein affirmed during Lindblad's Q3 earnings call, "You can see the revenue opportunity we have across the expanded fleet as we grow occupancy levels and increase yields." The cruise operator expanded its fleet as recently as August, with the addition of National Geographic's Islander 2 vessel. 

To accommodate the surge in demand, Lindblad recently brought on two strategic sales leaders who bring more than 40 combined years of cruise industry experience. Beyond ship-based travel, the company also enjoyed a nearly 100% year-over-year increase in land experiences revenue, which is earned from its non-cruise trip options. Felenstein referenced a "growing audience for high-quality adventure travel" as a main catalyst.

Profitability is still an issue

Despite markedly improved revenue, Lindblad posted a net loss of nearly $5.5 million last quarter as expenses outweighed sales. Profitability has proven difficult to achieve amid heightened fuel costs, supply chain disruptions, and inflation-related pressures.

Along with packing more passengers on its ships, Lindblad is also focusing on improving net profit margin. Felenstein mentioned "significant opportunity" to increase margins beyond historical levels during the Q3 earnings call. An expected easing of fuel and supply chain expenses in future quarters, coupled with improved occupancy, should support the company's "return to significant profitability."

The future looks bright

If current bookings are any indication, Lindblad's near-term forecast looks promising. 2023 bookings currently surpass 2019's, and a new booking day record was just set on Jan. 3.

So far this year, Lindblad reports a persistent increase in inbound customer calls, with its busiest day beating 2022's busiest day by nearly a third. If the current bookings season and rapidly growing adventure travel market are anything to go by, the company's future appears bright.

From its March 2021 all-time high just shy of $22, Lindblad stock sank roughly 50% to its current price around $11. And according to Yahoo! Finance, the company is projected to grow at a rate of 25% annually for the next five years. If this small-cap adventure travel specialist can continue on its current course and deliver on growth expectations, I think Lindblad Expeditions stock is a buy.