Morgan Stanley on Viking Holdings (VIK): 'We would be buyers on any short-term weakness'
Morgan Stanley analyst Stephen Grambling reiterated an Overweight rating and $62.00 price target on Viking Holdings (NYSE: VIK).
The analyst comments "Quick take: VIK reported another quarterly beat and saw stable forward pricing. Management had called out potential for pricing to "evolve to a mid-single digit increase along with capacity increases" and capacity growth for 2026 is back-half loaded so we still see potential for 2026 pricing to improve into 2H25 for the year ahead. Regardless, gross margins have expanded in 1H, consistent with most years, so net yields have been (and should) actualize above the gross revs/PCD, which would point to ongoing upside to consensus estimates. Even at ~4% yields, VIK's capacity growth of 9%+ over the next few years would drive consistent high teens EBITDA growth and >30% EPS growth. With the stock trading at 17.9x 2026 EPS, inline with RCL despite higher capacity growth and lower leverage, we see ongoing room for both upside to consensus and capital return (only 2.1x net debt / ebitda, below all cruise peers) catalyzing further re-rating. We would be buyers on any short-term weakness."
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Shares of Viking Holdings closed at $60.20 yesterday.