Cruises have long been a popular way to vacation. The biggest cruise companies own several cruise lines, with each of the major cruise companies taking a unique approach to keeping its customers loyal. If you want to invest in cruise line stocks, you have several attractive options.

Cruise line industry trends

While many travel companies were affected by the pandemic, cruise lines were some of the most severely hurt. Cruise ships were docked for more than a year, causing their owners to miss out on billions of dollars in earnings.

Revenue for each of the three largest cruise lines declined by between 73% and 80% in 2020. Although the cruise industry's annual revenue almost doubled in 2021 (from $3.36 billion to $6.65 billion), it's still far from the $27.5 billion reported in 2019.

The recovery process hasn't exactly been smooth sailing. Relaunched cruise ships have experienced outbreaks of COVID-19. Even when cruise lines have built some momentum, news of potential travel restrictions caused by the delta and omicron variants have sent their stock prices tumbling.

However, cruise line companies are reporting strong sales for upcoming cruises, which indicates a rebound in demand. But they've also had to take on significant debt to get through the pandemic, and revenues aren't predicted to get back to pre-COVID numbers until 2024.

These vacation travel companies have survived the most difficult period. That being said, cruise line stocks are still a long-term play that could have some rough seas ahead.

Top cruise line stocks

These are our picks for the best cruise line companies:

A woman on a ship staring out at the ocean.

Image source: Getty Images.

1. Royal Caribbean

Royal Caribbean (NYSE:RCL) is distinguished as being one of the most innovative cruise lines. Its ships are packed with state-of-the-art amenities, including virtual balconies, massive water slides, skydiving at sea, and even Broadway shows.

Royal Caribbean has made a number of investments, expanded its fleet, invested in ships powered by clean energy, and prioritized international expansion. Its investments may be paying off: Over the course of 2021, Royal Caribbean saw consistent growth in new bookings for 2022. By the third quarter of 2021, 2022 bookings in its two biggest markets -- the United States and the United Kingdom -- were exceeding 2019 levels. New bookings are also at a higher price point than they were in 2019, indicating the cruise line could be primed for a strong rebound.

2. Carnival

Carnival (NYSE:CCL) is the largest cruise company in the world. It was also one of the first to offer cruises in the price range of the average traveler. Although affordable cruises are more common now, the market was previously dominated by luxury voyages.

This cruise line is still known for its reasonable prices and ability to offer a fun time for everyone. Carnival cruises are popular among families and groups of friends alike, including younger generations. Carnival excels in customer satisfaction, winning the 2021 USA Today Readers' Choice Awards for best ocean cruise line.

Carnival's sales forecasts are promising, with bookings for 2022 representing growth over 2019's performance. The cruise line has also started opening earlier reservations for future cruises, which led to a $630 million increase in guest deposits as of the third quarter of 2021.

3. Norwegian Cruise Line Holdings

Norwegian Cruise Line Holdings (NYSE:NCLH) is a hit among casual cruisers and is known for its laid-back atmosphere. Norwegian offers what it calls "freestyle cruising," meaning its cruises have no dress codes, no set dining times, and no assigned seating.

Norwegian offers a variety of cabin categories, which enables it to accommodate every type of traveler. It was the first cruise line to offer studios exclusively for solo travelers, and it has lodging fit for everyone from people sailing on their own to large families.

The cruise line has implemented some of the strictest measures to avoid COVID-19 outbreaks as its cruises resume service. It has a 100% vaccination policy that it extended indefinitely in November 2021. Since all passengers must be vaccinated, Norwegian is able to offer mask-free cruises with no social distancing requirements.

Pent-up demand could help this cruise line to bounce back from the effects of the pandemic. When Norwegian announced its winter 2022-23 itineraries for its luxury Oceania Cruise brand, it set a single-day booking sales record. Norwegian expects to have all its ships sailing again by the spring of 2022.

4. Lindblad Expeditions

Lindblad Expeditions (NASDAQ:LIND) isn't your typical cruise company, and that could make it a safer play than most cruise line stocks. While others carry thousands of passengers per ship, Lindblad specializes in smaller, more expensive adventure cruises. The maximum capacity for these cruises is typically between 48 and 148 passengers, depending on the trip.

The main competitive advantage that Lindblad enjoys is its ability to offer premium, one-of-a-kind experiences. Travelers with Lindblad can book exciting expeditions all over the world, including to Antarctica, the Caribbean coast, and Patagonia. Because of the types of trips offered, Lindblad has built a loyal base of wealthy customers.

According to Lindblad, a majority of guests opted for future travel credits over a refund for voyages that were cancelled or rescheduled due to the pandemic. The travel company has seen significant increases in its booking numbers, even compared to pre-pandemic times. In its third quarter 2021 financial results, it reported that 2022 bookings were 51% ahead of bookings for 2021 and 27% ahead of bookings for 2020.

Investing in cruise line stocks in 2022

Considering how much the pandemic continues to affect cruise lines, investing in them is relatively risky. The cruise line business has high operating costs, and many cruise companies have lost a lot of money. Investors in search of safe stocks may want to stay away from this industry right now.

Nevertheless, cruise lines tend to have a passionate customer base with plenty of repeat passengers. Over the long term, cruise line stocks may be a good value investment provided you are comfortable with some volatility.