Viking Holdings Ltd.: 1Q Trading Preview: Will VIK navigate choppy European seas?

Research evidence excerpt

Viking Holdings Ltd.: 1Q Trading Preview: Will VIK navigate choppy European seas?

FoundationMEastern European and/or ME itineraries. However, the companies' long-lead time for

bookings (VIK ~86% booked at 4Q25 earnings call) and limited onboard

contributions should mean muted impact to 2026 pricing since the 4Q update

(2026 River/Ocean ~8%/~5.5% yield growth with 85%/87% of capacity sold). In fact,

premium itineraries for new River ships in Egypt coming online in 2H this year could

help offset any potential Europe weakness in the Ocean segment. 2027 itineraries

could also benefit from improved itineraries and pricing, helping to alleviate

incremental uncertainty on behalf of consumers. Ocean peers have called out

greater resilience at the high end, offering a positive read for VIK.

Implications/What to do with the stock: Cruise stocks in general have

underperformed the S&P 500 markedly over the past 30 days (-13% Cruise avg. vs.

S&P 500 +8%) amidst concerns around higher fuel prices, decelerating net yields

for the group (as we outlined in our NCLH recap here), and European booking

softness. VIK however remains the strongest relative performer YTD (+14%) and

should once again prove more resilient given the company caters to the highest-end/

luxury customer relative to peers and is almost entirely booked for the year. While

valuation appears more stretched vs. peers on conventional metrics (~19x our 2027

EPS including SBC vs. peer avg. ~9x), it appears more consistent on an unlevered

FCF yield basis. As such, stability in forward trends combined with capital return

could continue to prop the stock and keep us OW. We tweak our estimates for

2026/27 and raise our target EPS/EBITDA multiples modestly (~0.5x for each) and