Why Norwegian Cruise Line Holdings Stock Crashed

Core Insights - Norwegian Cruise Line Holdings (NCLH) reported mixed earnings, with a stock decline of 12.5% following the announcement [1][3] - The company beat earnings expectations with a non-GAAP profit of $1.20 per share but fell short on sales, reporting $2.9 billion against a forecast of $3 billion [1][2] - Year-over-year sales increased by 5%, reaching a new quarterly record, but GAAP earnings showed a nearly 10% decline to $0.86 per share [2][3] Financial Performance - The company achieved a gross margin of 31.83% and has a market capitalization of $10 billion [4] - Norwegian raised its earnings guidance for the year, now expecting $2.10 per share (adjusted), which is $0.02 above Wall Street predictions [4] - Despite the positive sales growth, the valuation appears high, with the stock trading at over 37 times earnings when adjusted for net debt [5] Market Reaction - The stock price currently stands at $18.84, with a day's range between $18.82 and $20.84 [4] - Investors seem unimpressed despite the raised guidance and record bookings, potentially due to concerns over valuation relative to earnings growth [4][5]