Norwegian Cruise Line (NCLH) is facing softer near-term demand and heavier promotional activity, while luxury cruises continue to outperform, Morgan Stanley said Wednesday after its latest travel agent channel checks.
Mainstream cruise customers are booking closer to departure and relying more on promotions. Luxury cruises continue to see strong demand, healthy pricing and bookings extending into 2027 and 2028, according to the note.
Morgan Stanley said its web pricing data and travel agent feedback suggest the mass-market cruise recovery remains uneven and increasingly promotion-dependent. Pricing has improved modestly since June but remains below year-ago levels for most brands.
The investment firm lowered its fiscal 2026 and 2027 EBITDA estimates by 4% and 6% following the company's Q2 results, reduced guidance and updated fuel assumptions. It said the Q2 beat was overshadowed by a weaker second-half outlook, soft ticket yields and the need for clearer evidence that revenue-management initiatives can restore pricing.
Morgan Stanley maintained its equal-weight rating on the stock and cut its price target to $19 from $22.
Price: $20.24, Change: $+0.17, Percent Change: +0.85%