Nvidia Could Crash Soon
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The artificial intelligence (AI) boom just created one of the biggest companies in the world. I'm talking about Nvidia. The firm is worth more than $1 trillion thanks to this explosion. However, most people don't realize Nvidia just got lucky! Because for most of its history, Nvidia has been focused on an entirely different industry – video games. You see, Nvidia's chips have been designed to serve just one purpose… To create ultrarealistic graphics in games such as Call of Duty and Counter-Strike. In other words… This technology was never meant to power AI. And that's also the reason why Nvidia could soon crash and burn… Because there's a new player in town – one that owns a patent-protected chip specifically designed to run AI on. This makes it much more powerful than Nvidia's gaming tech. I'm talking about a 100x performance boost. The U.S. Air Force, Cisco, and Raytheon are just some of this firm's early elite clients. But soon this chip will be available to the mainstream… And if you position yourself before it reaches the mass market, you could turn every $1 into $120… Just like early Nvidia investors did. Keith just published an urgent presentation on this unique opportunity. Inside, he explains all the details and how you can position yourself today. Get the full story here while there's still time.
One of the hottest industries for investors last year was cruise line stocks. Royal Caribbean Cruises (RCL) led the way, surging 162% in 2023. Rivals Carnival (CCL) and Norwegian Cruise Line Holdings (NCLH) rose 130% and 64%, respectively.
It's easy to see why the leading operators of recreational sea travel bounced back in a major way last year. Unlike other tourism transport segments that were up and running with minimal downtime, cruise line operators were essentially shut down by government restrictions for more than a year due to the pandemic. Getting back up to speed was a gradual process, and Royal Caribbean would go on to post operating losses for 10 consecutive quarters.
The seas are far more inviting now. All three players have now shattered pre-pandemic trailing revenue records. The future is just as bright, as bookings for upcoming sailings have never been higher — and at higher price points, to boot. Bears will argue that the stock gains are overshooting the breakthrough, but let the bulls enjoy the victory lap. Following Royal Caribbean's financial update on Thursday morning, it's not out of the question that the fast-growing cruise line stock can double again in 2024.
Respecting the crown
The world's second-largest cruise line posted mixed fourth-quarter results this week. Revenue rose 28% to $3.3 billion, just shy of the 29% year-over-year growth that analysts were targeting. It's a long way down from the 69% top-line increase that Royal Caribbean produced through the first three quarters of 2023, and the sixth consecutive period of sharply decelerating revenue growth.
That's fine. The year-over-year comparisons were bound to get smaller as business returned to normal. The real growth now is happening on the bottom line, where profitability has been explosive. Royal Caribbean's adjusted earnings of $1.25 per share reversed a year-ago deficit. It was also comfortably ahead of the $1.13 per share that Wall Street pros were forecasting. Exceeding expectations has become routine for Royal Caribbean in its recovery.
These aren't just consistent beats. Adjusted earnings have topped estimates by double-digit percentages. With passengers willing to pay up for watery escapes and Royal Caribbean able to keep costs in check, margins are expanding a lot wider than analysts are forecasting. The year ahead is looking solid.
Revenue should keep climbing at a brisk pace. Royal Caribbean noted on Thursday morning that the best five individual weeks of bookings in its history all took place since its previous quarterly report three months ago. The bottom line still remains the best reason for the shares to potentially double again in 2024.
Calm seas ahead
Royal Caribbean issued guidance for the new year. It sees adjusted earnings per share clocking in between $9.50 and $9.70 for all of 2024, a 40% to 43% increase over the past year. The analyst consensus is currently perched at $9.19 a share. Net cruise costs excluding fuel are expected to narrow significantly.
The shares are trading at just 13 times the midpoint of this year's projected profit. This seems pretty cheap for a company that is projecting to grow its bottom line at a pace that is more than 3 times that multiple. If you want to frame this in a more jaw-dropping way, Royal Caribbean began last year trading for just 5 times the adjusted earnings it is now modeling for this year.
If you want another mic drop, a year ago Royal Caribbean's guidance for 2023 was calling for just $3.00 to $3.60 in adjusted earnings per share. Of course, the stock more than doubled last year. With its current momentum of “beat and raise” reports, it wouldn't be shocking if Royal Caribbean eventually posts an adjusted profit well north of $10 a share in 2024.
The stock may have delivered huge gains in 2023, but the upside remains as big as its record-breaking Icon of the Seas ship. Bon voyage, investors.
Is THIS why Elon Musk left ChatGPT? (100X BETTER!)
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Elon Musk co-founded OpenAI, the company behind ChatGPT. Musk later left OpenAI… and created his own independent AI startup. And Elon's AI promises to be 100 times stronger than ChatGPT. Because ChatGPT only works online. While Elon's AI works in the real world. You can see and touch Elon's AI: see the real-life demonstration here. Since ChatGPT has already grown 42 times faster than the internet… The sky's the limit for Elon's AI. Here's the key fact: with Elon's three earlier startups… PayPal… SpaceX… and Tesla… You could've turned $300 into $647,000. Can Elon do it again with his AI startup? See for yourself right here in a shocking 2-minute live demonstration of Elon Musk's AI. Click here to watch the demo
