Jefferies Raises Royal Caribbean Rating After $3 Billion Sandals Deal

Jefferies raised Royal Caribbean Group to buy from hold and lifted its 12-month price target to $330 from $305 after the cruise operator agreed to spend approximately $3 billion on a 50% equity interest in Sandals and Beaches Resorts.

The transaction would expand Royal Caribbean’s business into Caribbean all-inclusive resorts. The company’s shares fell 2% after the deal was announced and were roughly flat in 2026.

Jefferies analyst David Katz said the transaction could lead to higher earnings estimates and improve Royal Caribbean’s growth outlook. Katz said the view reflects a more favorable fiscal 2027 net-yield outlook of 3.3%, compared with 2.9% previously, and strong confidence in Sandals growth.

Royal Caribbean is trading at less than 13 times current next-12-month enterprise value to earnings before interest, taxes, depreciation and amortization.

The rating change is broadly aligned with analyst sentiment. Of 30 analysts, 24 rate the stock buy or strong buy, while six have a hold rating.