Most stocks would take a hit after a company announces the exit of its founder-CEO on the same morning it posts financial results that fell roughly in line with expectations. Viking Holdings (VIK +1.64%) isn't most stocks. The leader in river cruises for North American outbound passengers jumped higher on Thursday after a double dose of news, hitting a new all-time high in the process.
Viking stock has now nearly doubled over the past year, a sharp contrast to the market performance of the three more traditional cruise line stocks in that time. It's a differentiated product, consisting primarily of a fleet of smaller boats with 95 cabins. The larger traditional ocean liners have thousands of cabins. The major cruise lines are starting to dip their toes into the river cruise market -- just as Viking is dabbling in small ocean liners -- but its dominance and strong brand loyalty continue to pay off. Viking stock has now almost quadrupled since going public two years ago.
Image source: Getty Images.
The end of a Tor-rific era
Torstein Hagen -- Tor, to friends and investors -- started Viking after purchasing four modest river cruises in 1997. Today, it has a fleet of over 100 ships on itineraries exploring some of the world's most storied rivers. Hagen's eventual departure was inevitable. He's in his 80s now.
The new CEO is Leah Talactac, who has been a rising member of Viking's executive team over the last 20 years. She was CFO in recent years, and early last year was also tapped as the company's president. Some can argue that Karine Hagen would've also been a great choice. She is Tor's daughter, the face and voice of Viking's promotional strategy, and the head of the cruise operator's product division. Talactac is still the smart choice, the highest-ranking executive and instrumental in taking Viking public two years ago.
NYSE: VIK
Key Data Points
Steady as she goes
There was naturally a lot of anxiety heading into this week's financial update. The war in Iran briefly disrupted its sailings in Egypt in early March, and the subsequent spike in fuel costs will weigh on the industry. The recent hantavirus scare could have also taken a toll on bookings.
Viking is doing just fine, for now, at least. The first quarter was solid. Revenue rose 17.5% to $1.05 billion, comfortably ahead of the 13% increase that analysts were modeling. Its adjusted net loss for the seasonally sleepy quarter was cut in half to $0.11 a share, just as Wall Street pros were expecting.
The real pressure point would be any insight Viking offers on bookings and margin concerns, something that crushed the third-largest traditional cruise line earlier this month. Thankfully, that was not the case here. Viking had 86% of its 2026 capacity booked back in March. Today, that has risen to 92%. New bookings have more than offset any potential cancellations.
A year ago at this time, Viking also had 92% of its 2025 capacity sold. In short, it's business as usual. Looking out to 2027, 38% of next year's capacity has been booked. A year ago, Viking had locked in just 37% of its 2026 sailings. Just as importantly, customers are spending more now on bookings than they were a year ago -- and a lot more for the 2027 watery adventures.
As a luxury brand stock, the bullish case for Viking in these turbulent times of maritime conflict, rising fuel costs, and now the emergence of a potential virus is that it is somewhat sheltered from these headwinds that are taking a toll elsewhere. Viking's target demographic is affluent retirees who want to make the most of their golden years with new experiences. Thursday's strong report and encouraging market reaction to its CEO succession strategy confirm that Viking Holdings is heading in the right direction.
