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Royal Caribbean Shares Popped: What You Need to Know

By Travis Hoium – Updated Apr 6, 2017 at 10:51AM

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Is this meaningful? Or just another movement?

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Royal Caribbean Cruises (NYSE: RCL) shares jumped 13% in early trading after the company released earnings.

So what: The company reported net income of $356.8 million, or $1.64 per share, up from $1.07 per share a year ago. It also increased guidance and said it would likely set an earnings record in 2011.

Now what: The high seas have been good to Royal Caribbean, and conditions look positive for the foreseeable future. Given the increased guidance, a forward price/earnings ratio of 14.3 is making this stock look relatively cheap. I always like to see an earnings beat followed by increased guidance, so I'm buying today's move higher.

Interested in more info on Royal Caribbean Cruises? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his Motley Fool CAPS picks at TMFFlushDraw.

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