Analyst Max Rakhlenko of TD Cowen maintained a Buy rating on OneSpaWorld Holdings (OSW – Research Report), with a price target of $15.00.
Max Rakhlenko’s Buy rating for OneSpaWorld Holdings (OSW) stems from a combination of factors including the company’s strong financial performance, promising market share growth opportunities, and the experienced staff’s contribution to overall productivity.
Primarily, Rakhlenko considers the company’s financial outlook encouraging, as OSW has been consistently surpassing expectations and is predicted to continue its trend of reducing debt. The conservative 4Q guidance and the valuation at 8.0% free cash flow yield on TD Cowen’s FY24 estimates further boost this perspective. Moreover, Rakhlenko notes that the management’s primary focus on expanding market share, as evident from the acquisition of the Adora cruise line and potential growth in other segments such as river cruising and smaller ship cruising.
In addition to this, Rakhlenko highlights the role of OSW’s experienced staff in driving results. Staff members with a high level of experience typically generate more revenue for the company, thereby boosting its performance. Positive indications are seen in improved staff retention and the anticipation of more experienced staff onboard in 1Q24. Furthermore, Rakhlenko is optimistic about OSW’s future outlook based on the strong demand for 2024 and the potential benefits of pre-booking capabilities. Lastly, he mentions the prudent financial management of the company, with the management committed to debt paydown while considering avenues for shareholder returns.
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Based on the recent corporate insider activity of 52 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of OSW in relation to earlier this year.
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OneSpaWorld Holdings (OSW) Company Description:
OneSpaWorld Holdings Ltd. engages in the provision of health and wellness services onboard cruse ships. The firm also sells beauty products onboard cruise ships and destination resort health and wellness centers. It operates through Maritime and Destination Resorts segment. The company was founded in 1901 and is headquartered in Nassau, Bahamas.
