One of my predictions for 2021 was that cruise line stocks would perform poorly as the year went along (see #7). My thinking was pretty simple: on an EV basis, cruise lines were already trading at valuations in line with their pre-pandemic levels. They were still going to be burning hundreds of millions a month while they waited for the pandemic to ramp down in the front half of the year, and I thought there was a chance that longer term they would face higher cost structure as governments and consumers demanded improved hygiene measures. I also thought there was a decent chance that "reopening falters" trade would apply not just to cruises but also to airlines, theme parks, movie theaters, etc.
Yet Another Look at a Reopening Play: $SIX
Yet Another Look at a Reopening Play: $SIX
Yet Another Look at a Reopening Play: $SIX
One of my predictions for 2021 was that cruise line stocks would perform poorly as the year went along (see #7). My thinking was pretty simple: on an EV basis, cruise lines were already trading at valuations in line with their pre-pandemic levels. They were still going to be burning hundreds of millions a month while they waited for the pandemic to ramp down in the front half of the year, and I thought there was a chance that longer term they would face higher cost structure as governments and consumers demanded improved hygiene measures. I also thought there was a decent chance that "reopening falters" trade would apply not just to cruises but also to airlines, theme parks, movie theaters, etc.