The brokerage described Royal Caribbean management as 'decidedly bullish.'
The company has a 'high degree of confidence' in its guidance that Caribbean net yields this year will be 'flattish,' while Europe and China are expected to have double-digit gains, Wells Fargo analyst Tim Conder said in a note.
Management said booked load factors and pricing for Quantum of the Seas are higher than for Oasis of the Seas at the same point before launch, and Pullmantur's 'drag is abating,' Conder added.
The brokerage said Royal Caribbean continues its focus on driving return on invested capital by 'disciplined, innovative capacity growth, global sourcing/capacity allocation and strong cost management.'
The company expects global capacity growth to stay in the 3% to 5% range, with Royal Caribbean and Carnival keeping to that level, despite other companies' more aggressive growth plans.
Wells Fargo reported Royal Caribbean sees the market for second-hand tonnage improving, with lenders more willing to finance acquisitions, so the company could dispose of some older ships at a faster rate than historically.
In terms of geographic capacity allocation, Conder identified Australia as the sole region at risk of 'over-shooting' in 2015.
Wells Fargo affirmed its 'outperform' (buy) rating for RCL and its forecasted 2014 earnings per share of $3.47, compared to the consensus expectation of $3.40 and 2013 EPS of $2.40. The brokerage expects 2015 EPS of $4.65, versus the $4.29 consensus.
RCL closed at $54.75 on Thursday.
