Hudson Maintains Buy on Royal Caribbean Cruises (RCL)

Hudson is out with its report today on Royal Caribbean Cruises RCL, maintaining Buy and a $58 PT. In a note to clients, Hudson writes, "2011 EPS guidance is $3.25-$3.45. Pre-call Street consensus is $3.31. Net yields are expected to increase 4-6%. This is up from RCL's last commentary in the 3Q, when net yields were expected to match 2010's 4-5%. Commentary on last call suggested yield growth would be strongest in 2Q-3Q 2011, and RCL's more detailed guidance today suggest more pronounced yield strength mid-year. We think that 14.0x is an appropriate forward multiple for RCL. We think that 12 months from now, RCL could trade at 14.0x next years earnings expectation, which at that time would be our 2012 estimate of $4.16. This would suggest a price target of $58, which is approximately 22% higher than RCL's current price. Accordingly, our rating on RCL is a Buy." At the time of posting, shares of RCL are trading at $46.00, down 7.07% from Wednesday's close.