Cruise line inventory Royal Caribbean (NYSE:), Carnival Corp. declined. (NYSE:), Danish Cruise Line (NYSE:), and Viking Holdings (VIK) on Friday after Bank of America analysts said in a note they see a modest decline in cruise prices.
RCL stock fell more than 5%, while CCL stock fell more than 8%. In addition, NCLH stock fell more than 7%, and VIK stock fell 5%.
The investment bank explained that based on cruise prices pulled in early June, there were slightly lower prices in ocean markets compared to early May.
“On a sequential basis, 40% of itineraries were lower in fares compared to 33% in May, but well below the 60% seen in the early March survey,” Bank of America said, adding that 32% of itineraries had positive growth in Prices (compared to 43% in early May) and 28% of itineraries were flat (compared to 25% in early May).
Furthermore, Bank of America notes that pricing in the Eastern Caribbean saw the largest sequential acceleration this month at +2%, representing the region's first sequential acceleration since February.
“This is the first month since December that Eastern Caribbean prices outperformed the Western Caribbean, which decelerated by -6% sequentially this month, the weakest region in our survey this month and the weakest data point since March,” the company says.
Western Caribbean cruising is said to have been one of the strongest cruises in the Bank of America survey since RCL's Icon of the Seas entered service, “and whose rates have become lower since initial entry into service.”