Nasdaq Markets

Image source: The Motley Fool.

In ordinary times, you can count on cruise lines to turn a profit. But, alas, these times are anything but ordinary, and as cruise ships lay dormant in ports around the world, a rethink is in order just to ensure survival.

That said, according to Wedbush analyst James Hardiman, Royal Caribbean (RCL) has enough liquidity available to see it through to February 2021 based on "an industry shutdown scenario.”

How does Hardiman arrive at such a conclusion? With operations shuttered, Royal Caribbean recently said that its monthly cash burn rate is between $150-$170 million. But with the addition of further outlays such as hedging costs and debt service expenses, the figure increases to between $250-$275 million a month.

In the meantime, the company has secured a $3.3 billion loan through a private offering of senior secured notes. After paying back loans amounting to $2.35 billion, Hardiman estimates RCL will have $1 billion left, “giving the company what we estimate would be pro-forma liquidity of ~$3.4B.”

Hardiman adds to the mix another $20-$50 million of monthly cash outflows. Where does this leave Royal Caribbean?

“Relative to the $3.4B of liquidity (with a $300M covenant-mandated floor),” Hardiman says, “This comes out to about 10 months of available liquidity on hand, which gets us into February of next year in a minimal revenue environment.”

However, even in a worst-case scenario, Hardiman doesn’t foresee RCL requiring a lifeboat, as it has further options.

The analyst concluded, "It remains to be seen whether or not RCL will be cash flow positive by early 2021, and yet we can appreciate what appears to be a hesitation to follow in the footsteps of both CCL and NCLH in significantly diluting shareholders by way of an equity offering. Such an offering nonetheless remains a viable option for the company, and so we have minimal concern that the company would actually run out of liquidity."

Accordingly, Hardiman keeps an Outperform rating along with a $63 price target. The implication for investors? Potential upside of 44% from current levels. (To watch Hardiman’s track record, click here)

All in all, the rest of the Street’s outlook for the struggling cruise line is a mixed bag. A Moderate Buy consensus rating is based on 5 Buys, 6 Holds and 1 Sell. However, the bulls are at the helm, as the average price target comes in at $67.80 and implies potential upside of 55%. (See Royal Caribbean's stock analysis at TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Danaos (DAC) came out with quarterly earnings of $1.34 per share, beating the Zacks Consensus Estimate of $1.19 per share. This compares to earnings of $2.53 per share a year ago. These figures are adjusted for non-recurring items.

What happened Shares of Littelfuse (NASDAQ: LFUS) closed Monday's trading 11.3% higher. The maker of automotive sensors and electric circuit protection components was the subject of a bullish analyst report today.

What happened? Shares of Chart Industries Inc (NASDAQ: GTLS) are up more than 13% on May 18, rising along with an energy industry that's surging today. At this writing, the Energy Select Sector SPDR (NYSEMKT: XLE) is up more than 8.3%, with the energy industry helping buoy

Facebook (NASDAQ: FB) was put on notice Monday the social media giant could face more regulation in Europe if it doesn't reign its current business practices. 

(RTTNews) - Following the sharp pullback seen last week, stocks moved significantly higher over the course of the trading session on Monday. The major averages all showed strong moves to the upside on the day.

In trading on Monday, shares of Ambarella, Inc. (Symbol: AMBA) crossed above their 200 day moving average of $54.97, changing hands as high as $55.25 per share. Ambarella, Inc. shares are currently trading up about 5.2% on the day. The chart below shows the one year performa

(New York)

In trading on Monday, shares of Schneider Electric (Symbol: SBGSF) crossed above their 200 day moving average of $92.58, changing hands as high as $93.15 per share. Schneider Electric shares are currently trading up about 10.6% on the day. The chart below shows the one year

In trading on Monday, shares of C.H. Robinson Worldwide, Inc. (Symbol: CHRW) crossed above their 200 day moving average of $76.88, changing hands as high as $78.25 per share. C.H. Robinson Worldwide, Inc. shares are currently trading up about 7.4% on the day. The chart below

(Washington)

(New York)

Stocks hurtled higher today, thanks to a combination of this morning's positive early stage test results for Moderna's (MRNA) potential COVID-19 vaccination, coupled with Fed Chair Jerome Powell's apparent willingness to further help the U.S. economy. The Dow notched a roughly

The world is on a home entertainment binder. The COVID driven stay-at-home initiative has people burning through streaming content like there is no tomorrow. Our constant need for entertainment amid this pandemic has provided a strong tailwind for video streaming services across

What happened Shares of Best Buy (NYSE: BBY) have jumped today, up by 10% as of 1 p.m. EDT, after the company received an upgrade from Wall Street. Telsey Advisory Group boosted its rating from market perform to outperform.

What happened We've been saying for weeks now that airlines, thanks in part to a government cash infusion, are in no immediate danger of liquidity issues, but the industry needs traffic to normalize in the months to come to avoid dire consequences. Monday brought promising news

What happened Shares of Brinker International (NYSE: EAT), Darden Restaurants (NYSE: DRI), Dave & Buster's (NASDAQ: PLAY), and BJ's Restaurants (NASDAQ: BJRI) were gaining today on a broad surge in the market after Moderna reported successful phase 1 results with its

In afternoon trading on Monday, Energy stocks are the best performing sector, higher by 9.2%. Within that group, TechnipFMC plc (Symbol: FTI) and Marathon Petroleum Corp. (Symbol: MPC) are two large stocks leading the way, showing a gain of 14.5% and 14.2%, respectively. Amo

The worst performing sector as of midday Monday is the Healthcare sector, up 2.9%. Within that group, Regeneron Pharmaceuticals, Inc. (Symbol: REGN) and Amgen Inc (Symbol: AMGN) are two of the day's laggards, showing a loss of 2.6% and 1.7%, respectively. Among healthcare ET