Buy Cruise Line Stocks? The Pros Aren't So Sure

Cruise line stocks have performed well so far in 2021, but analysts are still sitting on the sidelines amid cloudy reopening plans. 

A row of cruise ships.
(Image credit: Getty Images)

Cruise line stocks have been sailing higher in 2021 on expectations the major lines will hit the open waters again this year. And they earned a boost earlier this month after the U.S. Centers for Disease Control and Prevention (CDC) issued much-anticipated reopening guidelines for travel ship operators.

More recently, though, some of the wind has been taken out of cruise stocks' sails.

CDC guidelines have failed to provide a specific reopening date for cruise operators. Concerns that rising debt levels could negatively impact shareholder value are another hurdle.

And cruise line stocks recently took another recent hit after the U.S. Food and Drug Administration (FDA) and CDC suggested halting the use of Johnson & Johnson's (JNJ (opens in new tab)) single-dose COVID-19 vaccine after six women developed blood clots within two weeks of getting their shots – potentially tapping the brakes on the pace of immunization.

The concern could be short-lived, considering nearly 7 million people in the U.S. have received the JNJ shot. And in a joint statement issued by the two federal agencies, they said they are "recommending a pause in the use of this vaccine out of an abundance of caution," adding that the "adverse events appear to be extremely rare."

Michael Reinking, senior market strategist at the New York Stock Exchange, adds that "The White House has said that there will not be a 'significant impact' on vaccinations overall" due to the recommendation.

While valuations for these recovery stocks might be elevated given their run higher this year, the recent pullback in cruise line names could be a potential entry point for those looking to ride out the choppy waters.

So, is it time to jump in? Read on as we look at three cruise line stocks to see which ones, if any, analysts like ahead of a possible summer restart.

Data is as of April 13. Stocks are listed in order of best year-to-date returns.

Karee Venema
Contributing Editor, Kiplinger.com

With over a decade of experience writing about the stock market, Karee Venema is an investing editor and options expert at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.