← All companies ← NC Manual NCMI → ← NAT Marine Shipping NMM →

NCLH, Norwegian Cruise Line Holdings Ltd.

Marine Shipping capital-intensive Distress / turnaroundCyclical

We are a leading global cruise company which operates the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands.

In late 2023, in response to the Organisation for Economic Co-operation and Development ("OECD")'s BEPS 2.0 Pillar 2 global tax reform, the Company restructured its organizational structure by realigning many of its operations across its three different brands into a single jurisdiction, Bermuda.

Our brands offer itineraries to worldwide destinations including Europe, Asia, Australia, New Zealand, South America, Africa, Canada, Bermuda, Caribbean, Alaska and Hawaii.

Latest annual: FY2025 10-K

NCLH · Norwegian Cruise Line Holdings Ltd.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$9.8B

+3.7% YoY · 50% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $10.0B 5-yr avg $6.7B

Gross margin 43% 5-yr avg 33%

Operating margin 15.9% 5-yr avg −76.7%

ROIC 9% 5-yr avg 0%

Owner-earnings margin 10% 5-yr avg −96%

Free cash flow margin −9% 5-yr avg −108%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is Passenger (68%) and Onboard and other (32%).
Situation: Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock. Cyclical. Margins collapse and recover repeatedly across the record; a single year, good or bad, misstates the through-cycle earning power.
What moves the needle: Gross margin has run about 36% and operating margin about 15% through the cycle, a spread the cycle sets more than the company does. The margin is cyclical, swinging between −394% and 20% over the years, so the through-cycle figure carries more than any single year — and the balance sheet at the trough more than the peak. Capital spending runs about 26% of sales, well above depreciation, so the return earned on what it sinks into that plant weighs as much as the margin. On its own account, the filing leans hardest on pricing power & competition, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has sat near the cost of capital (median 9%). By owner earnings: roughly 11% of revenue reaches owners as cash, though it swings. The cycle and the balance sheet decide this one; the worst year tells more than the median, and the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Passenger is 68% of revenue, with Onboard and other the other meaningful line at 32%.

Revenue by product line, FY2025

Passenger68%$6.7B
Onboard and other32%$3.1B

By geographyNorth America57%Europe29%Asia Pacific10%Other Country3%

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$4.9B	$5.4B	$6.1B	$6.5B	$1.3B	$648M	$4.8B	$8.5B	$9.5B	$9.8B	$10.0B	RevenueRevenue
—	—	—	43%	−32%	—	12%	36%	40%	43%	43%	Gross marginGross mgn
14%	14%	15%	15%	58%	138%	28%	16%	15%	16%	16%	SG&A / revenueSG&A/rev
$925M	$1.0B	$1.2B	$1.2B	($3.5B)	($2.6B)	($1.6B)	$931M	$1.5B	$1.6B	$1.6B	Operating incomeOp. inc.
19.0%	19.4%	20.1%	18.2%	−272.2%	−393.9%	−32.0%	10.9%	15.5%	15.9%	15.9%	Operating marginOp. mgn
$633M	$760M	$955M	$930M	($4.0B)	($4.5B)	($2.3B)	$166M	$910M	$423M	$568M	Net incomeNet inc.
1%	1%	1%	-2%	—	—	—	-2%	—	1%	2%	Effective tax rateTax rate
											Cash flow & returns
$1.3B	$1.6B	$2.1B	$1.8B	($2.6B)	($2.5B)	$210M	$2.0B	$2.0B	$2.1B	$2.2B	Operating cash flowOp. cash
$446M	$521M	$567M	$647M	$740M	$759M	$810M	$883M	$974M	$1.2B	$1.2B	DepreciationDeprec.
$119M	$233M	$437M	$150M	$605M	$1.2B	$1.6B	$837M	$74M	$416M	$369M	Working capital & otherWC & other
$1.1B	$1.4B	$1.6B	$1.6B	$947M	$753M	$1.8B	$2.8B	$1.2B	$3.3B	$3.2B	CapexCapex
22.4%	25.4%	25.9%	25.3%	74.0%	116.2%	36.8%	32.2%	12.8%	33.2%	31.6%	Capex / revenueCapex/rev
$818M	$1.1B	$1.5B	$1.2B	($3.3B)	($3.2B)	($600M)	$1.1B	$839M	$928M	$1.0B	Owner earningsOwner earn.
16.8%	20.0%	24.9%	18.2%	−257.5%	−497.1%	−12.4%	13.1%	8.8%	9.4%	10.3%	Owner earnings marginOE mgn
$172M	$229M	$508M	$185M	($3.5B)	($3.2B)	($1.6B)	($745M)	$839M	($1.2B)	($949M)	Free cash flowFCF
3.5%	4.2%	8.4%	2.9%	−273.7%	−497.1%	−32.5%	−8.7%	8.8%	−11.9%	−9.5%	Free cash flow marginFCF mgn
$50M	—	$665M	$350M	—	—	—	—	—	—	—	BuybacksBuybacks
8%	9%	10%	9%	-21%	-15%	-9%	6%	10%	9%	9%	ROICROIC
14%	13%	16%	14%	-92%	-185%	-3309%	55%	64%	19%	23%	Return on equityROE
14%	13%	16%	14%	−92%	−185%	n/m	55%	64%	19%	23%	Retained to equityRetained/eq
											Balance sheet
$128M	$176M	$164M	$253M	$3.3B	$1.7B	$947M	$402M	$191M	$210M	$425M	Cash & investmentsCash+inv
$63M	$44M	$55M	$75M	$21M	$1.2B	$326M	$280M	$221M	$292M	$277M	ReceivablesReceiv.
$66M	$82M	$90M	$95M	$82M	$118M	$149M	$158M	$150M	$138M	$163M	InventoryInvent.
$38M	$53M	$160M	$101M	$83M	$233M	$229M	$174M	$171M	$170M	$185M	Accounts payablePayables
$91M	$73M	($14M)	$70M	$20M	$1.1B	$246M	$264M	$200M	$260M	$255M	Operating working capitalOper. WC
$411M	$518M	$550M	$730M	$3.6B	$3.3B	$1.9B	$1.3B	$1.0B	$1.1B	$1.3B	Current assetsCur. assets
$2.3B	$2.5B	$3.2B	$3.6B	$1.9B	$3.7B	$5.1B	$6.0B	$5.8B	$5.5B	$6.2B	Current liabilitiesCur. liab.
0.2×	0.2×	0.2×	0.2×	1.9×	0.9×	0.4×	0.2×	0.2×	0.2×	0.2×	Current ratioCurr. ratio
$1.4B	$1.4B	$1.4B	$1.4B	$98M	$98M	$98M	$98M	$136M	$136M	$136M	GoodwillGoodwill
$13.0B	$14.1B	$15.2B	$16.7B	$18.4B	$18.7B	$18.6B	$19.5B	$20.0B	$22.5B	$23.8B	Total assetsAssets
$6.4B	$6.4B	$6.6B	$6.8B	$12.2B	$12.6B	$13.9B	$14.4B	$13.4B	$15.0B	$15.6B	Total debtDebt
$6.3B	$6.2B	$6.4B	$6.5B	$8.9B	$10.9B	$12.9B	$14.0B	$13.2B	$14.8B	$15.2B	Net debt / (cash)Net debt
3.3×	3.9×	4.5×	4.3×	-7.2×	-1.2×	-1.9×	1.3×	—	—	2.2×	Interest coverageInt. cov.
$4.5B	$5.7B	$6.0B	$6.5B	$4.4B	$2.4B	$69M	$301M	$1.4B	$2.2B	$2.4B	Shareholders’ equityEquity
1.4%	1.6%	1.9%	1.5%	8.7%	19.1%	2.3%	1.4%	1.0%	0.9%	0.9%	Stock comp / revenueSBC/rev
—	—	—	—	$1.3B	$1.3B	$1.3B	$1.3B	—	—	$1.3B	Goodwill written downGW imp.
											Per share
228M	229M	224M	216M	255M	365M	420M	427M	515M	478M	466M	Shares out (diluted)Shares
$21.39	$23.52	$26.98	$29.85	$5.02	$1.77	$11.54	$20.00	$18.41	$20.57	$21.52	Revenue / shareRev/sh
$2.78	$3.31	$4.25	$4.30	$-15.75	$-12.33	$-5.41	$0.39	$1.77	$0.89	$1.22	EPS (diluted)EPS
$3.59	$4.71	$6.72	$5.43	$-12.94	$-8.81	$-1.43	$2.63	$1.63	$1.94	$2.21	Owner earnings / shareOE/sh
$0.75	$1.00	$2.27	$0.86	$-13.75	$-8.81	$-3.75	$-1.74	$1.63	$-2.45	$-2.04	Free cash flow / shareFCF/sh
$4.79	$5.98	$6.98	$7.56	$3.72	$2.06	$4.25	$6.44	$2.35	$6.82	$6.80	Cap. spending / shareCapex/sh
$19.92	$25.06	$26.57	$30.10	$17.09	$6.66	$0.16	$0.70	$2.77	$4.63	$5.22	Book value / shareBVPS

The diluted share count moved ×1.43 into 2021 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	−0.4%/yr	+32.6%/yr
Owner earnings / share	−6.6%/yr	—
EPS	−11.9%/yr	—
Capital spending / share	+4.0%/yr	+12.9%/yr
Book value / share	−15.0%/yr	−23.0%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

478Mpeak FY2024

ROIC

9%low FY2020

Gross margin

43%low FY2020

Net debt ÷ owner earnings

15.9×peak FY2025

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$928Mowner earningsvs.$423Mnet incomelow FY2020

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned $928M of owner earnings, the operating cash left after the $1.2B it takes just to hold its position. It put $2.1B more into growth; free cash flow, after that spending, was ($1.2B).

Reported net income$423M

Owner earnings$928M · 9% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$423M	$910M	$166M	($2.3B)	($4.5B)
Depreciation & amortizationnon-cash charge added back	+$1.2B	+$974M	+$883M	+$810M	+$759M
Stock-based compensationreal costnon-cash, but a real cost	+$88M	+$92M	+$119M	+$114M	+$124M
Working capital & othertiming of cash in and out, other non-cash items	+$416M	+$74M	+$837M	+$1.6B	+$1.2B
Cash from operations	$2.1B	$2.0B	$2.0B	$210M	($2.5B)
Maintenance capital expenditurethe spending needed just to hold position and volume	−$1.2B	−$1.2B	−$883M	−$810M	−$753M
Owner earnings	$928M	$839M	$1.1B	($600M)	($3.2B)
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$2.1B	—	−$1.9B	−$974M	—
Free cash flow	($1.2B)	$839M	($745M)	($1.6B)	($3.2B)
Owner-earnings marginowner earnings ÷ revenue	9%	9%	13%	-12%	-497%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $1.2B, roughly its depreciation, the rate its assets wear out). The other $2.1B of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $88M), owner earnings is nearer $839M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 2.1×

Adequate

Operating income $1.6B ÷ interest expense $728M

What this means
Comfortable in a normal year, but below the margin of safety Graham looked for. Worth checking how stable the coverage has been across a full cycle.
How heavy is the debt, net of cash? $14.5B · 9.3× operating profit

Heavy net debt

Cash $210M + ST investments $240M − debt $15.0B

What this means
Netting $450M of cash and short-term investments against $15.0B of debt leaves $14.5B owed, about 9.3× a year's operating profit (9.6× on the gross debt, before the cash). Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 9d

Tight

DSO 11 + DIO 9 − DPO 11 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 8%

Solid through the cycle

10-yr median, range -21%–10%; the latest year is left out — large non-operating charges put its operating line well above pretax profit

Industry peers: median 7%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years, so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 9%

Solid through the cycle

10-yr median margin, range -497%–25%; latest $928M = operating cash $2.1B − maintenance capex $1.2B

Industry peers: median 12%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 9% of revenue this year, a 9% median across 10 years. It chose to put $2.1B more into growth, so free cash flow this year was ($1.2B) — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $88M of SBC) leaves $839M.
Are earnings backed by cash? 4.94×

Cash-backed

Cash from ops $2.1B ÷ net income $423M

In the filing’s words The filing leans on adjusted, non-GAAP earnings, but the GAAP profit is itself cash-backed — the adjustments are not papering over a cash shortfall here.

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 38%

Reinvests most of it

Dividends + buybacks $350M ÷ Owner Earnings $928M

What this means
Of $928M Owner Earnings, $350M (38%) went back to shareholders, $0 dividends, $350M buybacks. Net of $88M stock comp, the real buyback was about $261M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 2.80×

Expanding

Capex $3.3B ÷ depreciation $1.2B

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Pass

Revenue ≥ $2B · $9.8B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 0.21×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Miss

Debt ≤ working capital · $15.0B vs ($4.3B) WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 3 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Miss

Earnings +33% over the record · −36%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $1.09/share (latest year $0.92), the averaged base the calculator's gate runs on, and book value is $4.81/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 7 of 10

What this means
Lost money in 3 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 0 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 20% → 14% (3-yr avg ends)

What this means
Through the cycle the operating margin slipped — about 20% early to 14% lately, median 15% — competition or costs are biting in.
Reinvestment, incremental ROIC 7%

What this means
Reinvested capital came back at only a modest incremental return — near the cost of capital, where extra growth adds little per dollar. The record shows whether it is a soft stretch or a thinning moat.
Owner earnings growth −1%/yr

What this means
Owner earnings shrank about 1% a year over the record.
Worst year 2021 · −393.9% op. margin

What this means
Operations went underwater in 2021, understand why before trusting the good years.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing Named as a competitive risk

Its FY2025 10-K names artificial intelligence as a competitive threat.

“We may also fail to adopt AI technologies at an appropriate pace, which could put us at a competitive disadvantage.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$1.3B

Cash & short-term investments$425M
Receivables$277M
Inventory$163M
Other current assets$443M

Current liabilities$6.2B

Accounts payable$185M
Other current liabilities$6.0B

Current ratio0.21×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.18×stricter: inventory excluded

Cash ratio0.07×strictest: cash alone against what's due

Working capital($4.9B)the cushion left after near-term bills

Revenue, latest quarter vs. a year ago+9.6%the freshest read on whether the business is still growing

Current ratio, recent quarters0.2× → 0.2×

Deeper floors

Tangible book value$1.8Bequity stripped of goodwill & intangibles

Net current asset value($20.1B)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$2.5B$928M of it operating leases

Deferred revenue$3.7Bcustomer cash collected before delivery; operating float

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $8.1B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$16.4B · 202%
Buybacks$1.1B · 13%

Returned to owners$1.1B
301% of the owner earnings the business produced over the span, $0 as dividends and $1.1B as buybacks.
Source of funding−$9.3B
Reinvestment and shareholder returns ran $9.3B beyond the operating cash the business generated, so the gap was financed off the balance sheet: debt rose from $6.4B to $15.6B.
Average price paid for buybacks—
Buybacks ran $1.1B over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count104.6%
The diluted count rose from 228M to 466M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$636M3% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity6%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$27Mover 10 years buying other businesses, against $16.4B of capital spent building

$5.2B written down across 4 years (2020, 2021, 2022, 2023): goodwill the company has already conceded it overpaid for, charged against earnings. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Harry Sommer	$19.7M	$14.2M	($3.2B)
2022	Harry Sommer	$21.2M	$8.7M	($600M)
2023	Harry Sommer	$8.9M	$11.6M	$1.1B
2023	Harry Sommer	$12.4M	$38.9M	$1.1B
2024	Harry Sommer	$12.8M	$24.2M	$839M
2025	Harry Sommer	$13.8M	$15.5M	$928M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio530:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$88M
The slice of the business handed to employees in shares this year, 1% of revenue, equal to 6% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Norwegian Cruise Line Holdings Ltd. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

4 of the 5 tests turned up something to look into; the other 1 came back clean.

Look hereIs it less profitable than it was?10.5% vs 20.6%
The owner-earnings margin averaged 20.6% early in the record and 10.5% across the last three years, and the latest year has not recovered. Ask the filing whether that is a structural drift or a cyclical trough — price, mix, cost, or a competitor — and whether it is permanent.
Look hereDid the share count rise anyway?104.6%
Diluted shares grew 104.6% over 2016–2025, even as the company spent $1.1B on buybacks. The repurchases were outrun by issuance — to staff, in a raise, or in a deal — and the filing says which; owners' slice still shrank. Read the buyback line beside this one, not on its own.
Look hereDid debt outgrow the business?$6.4B → $15.6B
Debt rose from $6.4B to $15.6B while owner earnings went from about $1.1B to $963M — about 5.6 years of owner earnings in debt then, about 16 now: measured against what the business earns, the balance sheet carries more debt than it did. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
Look hereDid receivables and inventory outpace sales?3% → 4% of sales
Receivables and inventory grew from $129M to $440M while revenue grew 106%: working capital is climbing faster than sales (3% of revenue then, 4% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Marine Shipping

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
CCLCarnival Corp.	$26.6B	38%	15.0%	9%	13%
RCLRoyal Caribbean Cruises	$17.9B	44%	19.4%	7%	22%
NCLHNorwegian Cruise Line Holdings Ltd.	$9.8B	38%	15.7%	9%	11%
KEXKirby	$3.4B	—	7.7%	4%	10%
MATXMatson	$3.3B	96%	11.4%	11%	12%
TDWTidewater Inc.	$1.4B	—	-12.5%	-6%	3%
INSWInternational Seaways Inc. Common Stock	$843M	—	12.3%	3%	33%
PANLPangaea Logistics Solutions Ltd.	$632M	—	7.7%	10%	10%
Group median	—	41%	11.8%	8%	11%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Norwegian Cruise Line Holdings Ltd. has delivered.

Norwegian Cruise Line Holdings Ltd.’s latest year shows negative owner earnings, the mark of a build-out: total capital spending outruns the cash the business throws off today. So the tool opens on the steady-state base (maintenance capex in place of the build-out spend), the cash it would earn at rest; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Norwegian Cruise Line Holdings Ltd. earns about $1.5B on its 15.0% median owner-earnings margin. This year’s 9.4% margin runs below that; the reported figure may understate a lean year. Normalize, below, values the price on that through-cycle figure rather than the latest year.

Base Normalize · through-cycle ($1.5B) Net of stock comp (−$91M) Steady-state · maintenance capex ($1.1B)

—

The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’16→’25−1%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow ($949M) on 459M shares outstanding, per the 10-Q cover, as of 2026-04-22; net debt $15.2B. The base opens on the steady-state figure (the latest year is negative on total capex mid-build-out); clear Steady-state to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($3.2B) runs well above depreciation ($1.2B), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $1.1B, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh NCLH against another business →

The owners of NCLH: the meeting and the votes →

Cite: Owner Scorecard, "Norwegian Cruise Line Holdings Ltd. (NCLH), the owner's record," https://ownerscorecard.com/c/NCLH, data as of 2026-07-09.

Manual order: ← NC its page in the Manual NCMI →

Industry order: ← NAT the Marine Shipping chapter NMM →