Why Carnival, Norwegian Cruise Line, and Royal Caribbean Shares Are Sinking in Early Trading

Several major cruise lines, including Carnival Corporation (NYSE: CCL) (NYSE: CUK), Norwegian Cruise Line Holdings (NYSE: NCLH), and Royal Caribbean Group (NYSE: RCL) are seeing their share prices plummet immediately after market open today. Their shares were also trading down in before-hours action.

The cruise ship shares ran aground after Friday's statement by British Prime Minister Boris Johnson, reported by The Guardian, that his country is "looking very carefully at the spread of the pandemic as it evolves" after cases spiked in several European countries, and that "we could expect (and) are now seeing a second wave coming in." The Evening Standard also indicated fresh lockdowns could be in the wind.

A large modern shipwreck in a sunlit sea with a rocky breakwater in the foreground.

Image source: Getty Images.

Additionally, the Healthy Sail Panel, a group of health experts assembled by Royal Caribbean and Norwegian Cruise Line, announced it presented the CDC with a 65-page document this morning, Sept. 21, detailing 74 protocols for safe voyage resumption.

Thorough testing and screening of both passengers and crew before boarding tops the list of strategies recommended by the Healthy Sail Panel. Other measures include greatly increased sanitation and air filtration, on-board symptom tracking, preparations for quarantine of infected individuals, physical distancing, mask wearing by crew and guests, the presence of an onboard clinic and qualified medical personnel, and strict limits on shore excursions, among others.

Royal Caribbean's CEO Richard Fain said the companies "understand our responsibility to act aggressively to protect the health and safety of our guests and crew."

The three stocks are down between 4% and 7% this morning within an hour of market open.

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Rhian Hunt has no position in any of the stocks mentioned. The Motley Fool recommends Carnival. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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