Royal Caribbean (RCL) and Norwegian Cruise Line (NCLH) are poised to see lower net yields in H2 on account of bookings weakness owing to the ongoing Iran conflict, Morgan Stanley said in a Wednesday research note.

Morgan Stanley estimated a modest net yield beat in Q2 for Royal Caribbean, but lowered its estimates for Q3 and Q4 to 0.5% from 1% and to 4% from 4.5%, respectively. For Norwegian Cruise Line, Morgan Stanley said that the company's 400 basis point reduction to 2026 net yield guidance was "appropriately conservative," but lowered its estimate for Q4.

Additionally, Morgan Stanley said that travel backdrop continues to remain "solid", as evidenced by Bank of America card spending on cruises rising to 9.8% in June from 8.4% in May, with airline and hotel data spend showing strongest growth rates in over a year.

Viking (VIK) appears to be a standout, with the company more than 92% booked for 2026 making it largely immune from demand volatility, according to the note. Morgan Stanley estimated net yields of 5.6% and EBITDA of $714 million for Q2.

Morgan Stanley maintained its neutral rating on Royal Caribbean and Norwegian Cruise Line with price target of $310 and $22, respectively. For Viking, Morgan Stanley raised its price target to $115 from $97 and reiterated its buy rating.

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