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Category: Royal Caribbean Cruises (RCL)
Date: 21 June 2020 Stock price of Royal Caribbean: $186.56 Royal Caribbean Cruises (RCL) announced the closing off of their secured notes issue program in which the group aims to boost their balance sheet by over $2.15 billion as it burns through cash while their operations are on hold due to the Covid-19 pandemic.
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We are the world's second largest cruise company. We control and operate four global cruise brands: Royal Caribbean International, Celebrity Cruises, Azamara and Silversea Cruises "
More Royal Caribbean Cruises (RCL)
We are the world's second largest cruise company. We control and operate four global cruise brands: Royal Caribbean International, Celebrity Cruises, Azamara and Silversea Cruises (collectively, our "Global Brands"). We also own a 50% joint venture interest in the German brand TUI Cruises and a 49% interest in the Spanish brand Pullmantur (collectively, our "Partner Brands").
Together, our Global Brands and our Partner Brands operate a combined total of 61 ships in the cruise vacation industry with an aggregate capacity of approximately 141,570 berths as of December 31, 2019. Our ships operate on a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents. In addition to our headquarters in Miami, Florida, we have offices and a network of international representatives around the world, which primarily focus on sales and market development. We compete principally by operating valued brands that offer exceptional service provided by our crew and on the basis of innovation and quality of ships, variety of itineraries, choice of destinations and price.
We believe that our commitment to build state-of-the-art ships and to invest in the maintenance and upgrade of our fleet to, among other things, incorporate many of our latest signature innovations, allows us to continue to attract new and loyal repeat guests. We believe cruising continues to be a popular vacation choice due to its inherent value, extensive itineraries and variety of shipboard and shoreside activities. In addition, we believe our brands are well-positioned globally and possess the ability to attract a wide range of guests by appealing to multiple customer bases allowing our global sourcing to be well diversified. Royal Caribbean was founded in 1968 as a partnership. Its corporate structure has evolved over the years and, the current parent corporation, Royal Caribbean Cruises Ltd., was incorporated on July 23, 1985 in the Republic of Liberia under the Business Corporation Act of Liberia.
Together, our Global Brands and our Partner Brands operate a combined total of 61 ships in the cruise vacation industry with an aggregate capacity of approximately 141,570 berths as of December 31, 2019. Our ships operate on a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents. In addition to our headquarters in Miami, Florida, we have offices and a network of international representatives around the world, which primarily focus on sales and market development. We compete principally by operating valued brands that offer exceptional service provided by our crew and on the basis of innovation and quality of ships, variety of itineraries, choice of destinations and price.
We believe that our commitment to build state-of-the-art ships and to invest in the maintenance and upgrade of our fleet to, among other things, incorporate many of our latest signature innovations, allows us to continue to attract new and loyal repeat guests. We believe cruising continues to be a popular vacation choice due to its inherent value, extensive itineraries and variety of shipboard and shoreside activities. In addition, we believe our brands are well-positioned globally and possess the ability to attract a wide range of guests by appealing to multiple customer bases allowing our global sourcing to be well diversified. Royal Caribbean was founded in 1968 as a partnership. Its corporate structure has evolved over the years and, the current parent corporation, Royal Caribbean Cruises Ltd., was incorporated on July 23, 1985 in the Republic of Liberia under the Business Corporation Act of Liberia.
Quick facts about Royal Caribbean Cruises (RCL)
- Royal Caribbean Cruises is listed on the New York Stock Exchange under share code ticker: RCL
- Together, our Global Brands and our Partner Brands operate a combined total of 61 ship
- Royal Caribbean Cruises had the capacity of approximately 141,570 berths (per year) as of December 31, 2019
- Passengers Carried: 6,553,865
- Passenger Cruise Days: 44,803,953
- Revenues in 2019: $10.95 billion
- Earnings per Royal Caribbean Cruises share in 2019: $8.95
- Dividends per Royal Caribbean Cruises share: $2.96
ROYAL CARIBBEAN ANNOUNCES CLOSING OF CONCURRENT OFFERINGS OF $2.15 BILLION SENIOR GUARANTEED NOTES AND SENIOR CONVERTIBLE NOTES
MIAMI, June 9, 2020 /PRNewswire/ -- Royal Caribbean Cruises Ltd. (NYSE: RCL) (the "Company") today announced that it has closed its concurrent private offerings of $1.0 billion aggregate principal amount of 9.125% Senior Guaranteed Notes due 2023 (the "Senior Notes") and $1.15 billion aggregate principal amount of 4.250% of Convertible Senior Notes due 2023 (the "Convertible Notes" and, collectively with the Senior Notes, the "Notes"). The Senior Notes will mature on June 15, 2023 unless earlier redeemed or repurchased and the Convertible Notes will mature on June 15, 2023, unless earlier converted, redeemed pursuant to a tax redemption or repurchased.
The Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by RCI Holdings LLC, a limited liability company formed and existing under the laws of Liberia and a direct, wholly-owned subsidiary of the Company that owns 100% of the equity interest of certain of the Company's wholly-owned vessel-owning subsidiaries. The Convertible Notes will not be guaranteed by any of the Company's subsidiaries.
The Company expects to use the combined net proceeds from the offerings of the Notes for general corporate purposes, which may include the repayment of indebtedness.
Nothing contained herein shall constitute an offer to sell or the solicitation of an offer to buy any security. The Notes are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States, only to certain non-U.S. investors pursuant to Regulation S. The Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act.
The Senior Notes are fully and unconditionally guaranteed on a senior unsecured basis by RCI Holdings LLC, a limited liability company formed and existing under the laws of Liberia and a direct, wholly-owned subsidiary of the Company that owns 100% of the equity interest of certain of the Company's wholly-owned vessel-owning subsidiaries. The Convertible Notes will not be guaranteed by any of the Company's subsidiaries.
The Company expects to use the combined net proceeds from the offerings of the Notes for general corporate purposes, which may include the repayment of indebtedness.
Nothing contained herein shall constitute an offer to sell or the solicitation of an offer to buy any security. The Notes are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and outside the United States, only to certain non-U.S. investors pursuant to Regulation S. The Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy the Notes or any other securities and shall not constitute an offer, solicitation or sale in any jurisdiction in which such offer, solicitation or sale would be unlawful. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act.
Royal Caribbean Cruises (RCL) stock price history
The image below shows the stock price history of Royal Caribbean Cruises (RCL) over the last 3 years. And was a pretty good time for RCL stock until the start of the year when the Covid-19 saw a halt to all RCL cruise ship activities. Over the last 3 years the stock of RCL declined by -50%.
Our latest stock valuation of Royal Caribbean Cruises (20 May 2020)
So what do we value Royal Caribbean Cruises at based on their 1st quarter 2020 earnings report and the fact that made a significant loss during 1Q 2020? Based on their earnings report and the fact that they are loss making we have decided to value RCL at their stockholders equity per share which is $48.92 a stock. We therefore believe the stock of Royal Caribbean Cruises is slightly undervalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $48.92, so we would suggest looking to enter into the stock of Royal Caribbean Cruises at $42.10 or below.
We expect the stock of Royal Caribbean to kick up from its current price in coming weeks and months as the Covid-19 pandemic starts to ease and countries starts opening up gradually.
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $48.92, so we would suggest looking to enter into the stock of Royal Caribbean Cruises at $42.10 or below.
We expect the stock of Royal Caribbean to kick up from its current price in coming weeks and months as the Covid-19 pandemic starts to ease and countries starts opening up gradually.