Analyst Bullish on Cruise Industry

The cruise industry is poised for smooth sailing according to Michael Savner, an analyst for Bank of America, as he initiated Royal Caribbean Cruises and Carnival Corp. coverage on Tuesday. "We are bullish on the cruise industry, based on recent signs of improvement we have observed," he said. "There is still healthy consumer demand for cruises, and we expect that further capacity expansion outside the Caribbean over the next few years could help offset a weak Caribbean market and drive incremental growth." Savner tagged both cruise operators with "Buy" ratings, based on Carnival's deep brand portfolio and Royal Caribbean's new revenue opportunities through its acquisition of Spain-based cruise and tour operator Pullmantur S.A.

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