Royal Caribbean Cruises (RCL) stock plummeted 5.02% in pre-market trading on Thursday, following a significant price target cut by Morgan Stanley. The cruise line operator's shares faced pressure after the influential investment bank lowered its target price for Royal Caribbean Group to $220 from $270.
Morgan Stanley analyst Jamie Rollo maintained an Equal-Weight rating on Royal Caribbean stock while implementing the substantial reduction in the price target. This move by a major Wall Street firm appears to have sparked concern among investors, leading to the sharp decline in RCL's stock price.
The cruise industry has been navigating choppy waters in recent years, facing challenges from the global pandemic and subsequent recovery efforts. While Royal Caribbean and its peers have seen a resurgence in demand, concerns about valuation and potential headwinds seem to be weighing on investor sentiment. The Morgan Stanley price target cut suggests that analysts may be recalibrating their expectations for the cruise line's near-term performance and growth prospects.
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