OSW · OneSpaWorld Holdings
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $34.56
Note written ·
Price against the kill line
10.9% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $34.56, on record since 11 November 2026. The shares are up 15.5% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $34.56, which is above the $33.05 52-week intraday high of 9 November 2026 and would show the shares leading the S&P 500, proving this call wrong.
Research onlyNot in the portfolio.
Key figures from the filings · Consumer Discretionary
Quarter to 30 September 2026, filed 29 October 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 277
- Revenue, change on a year (%)
- +7.0
- Operating margin (%)
- 10.8
- Free cash flow, four quarters ($M)
- 94.3
- Net cash, cash less debt ($M)
- −38.4
- Price to earnings (×)
- 36.3
- Enterprise value to sales (×)
- 3.0
- Enterprise value to operating income (×)
- 33.3
All filed numbers
What OneSpaWorld Holdings reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Operating margin (%) |
|---|---|---|---|
| first filed | 277 | +7.0 | 10.8 |
| first filed | 261 | +8.5 | 9.4 |
| first filed | 248 | +12.7 | 9.2 |
| first filed | 242 | +11.5 | 6.8 |
| first filed | 259 | +7.0 | 10.2 |
| first filed | 241 | +7.0 | 9.2 |
| Pre-tax income ($M) | 28.8 |
| Net income ($M) four quarters: 84.8 | 28.2 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −1.7 |
| Operating cash flow ($M) | 108 |
| Capital spending ($M) | 13.9 |
| Free cash flow ($M) | 94.3 |
| Cash and short-term investments ($M) | 32.1 |
| Debt ($M) non-current long-term debt | 70.5 |
| Net cash, cash less debt ($M) | −38.4 |
| Deferred revenue ($M) | Not reported |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 50.5 |
| Inventory ($M) | 60.1 |
| Shareholders' equity ($M) | 571 |
| Market value ($M) | 3,083 |
| Enterprise value, market value plus net debt ($M) | 3,122 |
| Enterprise value to sales (×) | 3.0 |
| Enterprise value to operating income (×) | 33.3 |
| Price to earnings (×) | 36.3 |
| Price to book value (×) | 5.4 |
| Free-cash-flow yield (%) | 3.1 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 6.7% of shares outstanding sold short, 9.7 days of average trading to cover, +13.8% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $6.6M |
| 12 monthsfrom | $0 | $14.9M |
The thesis
OneSpaWorld's business is doing well, but its shares already price in most of that news and are more likely to lag the S&P 500 over the next three months. The company beat its third-quarter numbers and raised 2026 guidance on 28 October 2026. The shares then rose to a 52-week intraday high of $33.05 on 9 November 2026. Carnival's December outlook is the next outside read on cruise demand. The company's own fourth-quarter report, expected in late February 2027, is the next result that can support a higher valuation.
OneSpaWorld runs the spas and wellness centers on most large cruise ships. Third-quarter revenue rose 7% to $276.5 million. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) rose 12% to $39.2 million, according to the company's 8-K of 28 October 2026. The rating is Low for three reasons. The shares closed at $31.42 on 11 November 2026, just under TD Cowen's $32 target. The raised revenue guide left its top end unchanged. And two directors sold shares into the rally, according to SEC Form 4 filings dated 4 November 2026 and 10 November 2026.
The price already reflects the beat. The 11 November 2026 close of $31.42 sits well above the 50-day average of $24.69 and close to the targets of the two Buy-rated firms that raised them on 29 October 2026 (TD Cowen at $32, Stifel at $35).
Bullish and bearish views on OneSpaWorld Holdings Limited
The bull case on OneSpaWorld Holdings Limited (OSW), in brief: revenue is growing faster than the fleet. The bear case: the top of the guide did not move.
Bull case
- Revenue is growing faster than the fleet. In the third quarter, average weekly revenue per ship rose to $99,965 from $95,675 a year earlier, while average ships in service rose to 206 from 199 (company 8-K, 28 October 2026). Guests are spending more on each ship, and new ships add to that.
- Margins are widening. Adjusted EBITDA grew 12% on 7% revenue growth in the third quarter, and adjusted earnings per share were $0.34 (company 8-K, 28 October 2026).
- Guidance was raised again. Fiscal 2026 adjusted EBITDA guidance moved to $138–140 million from $130–140 million (company 8-K, 28 October 2026).
- Cash is going back to shareholders. The company completed its $75 million repurchase program, bought about 1.41 million shares for $37.2 million in the third quarter, and approved a new $100 million program. It also raised the quarterly dividend 25% to $0.0625 (company 8-K, 28 October 2026).
- Cruise lines report strong onboard spending. Norwegian Cruise Line Holdings reported third-quarter onboard and other revenue of $1.001 billion, up from $888.2 million a year earlier, and raised its 2026 adjusted EPS outlook to about $1.70 from $1.50 (Baird Maritime, 29 October 2026).
Bear case
- The top of the guide did not move. The fiscal 2026 revenue range went to $1.033–1.038 billion from $1.018–1.038 billion (company 8-K, 28 October 2026). Only the low end rose, so the third-quarter beat did not lift the ceiling.
- Directors sold into the rally. Director Leonard Fluxman sold 150,611 shares in the open market at an average of $31.33 from 6 November to 9 November 2026 (SEC Form 4, filed 10 November 2026). Director Andrew Heyer sold 64,219 shares at an average of $30.02 between 20 August 2026 and 2 November 2026 (SEC Form 4, filed 4 November 2026).
- Cruise pricing softens in the fourth quarter. Norwegian Cruise Line Holdings guided fourth-quarter net yield down about 6.5% in constant currency (Baird Maritime, 29 October 2026). Weaker cruise pricing can affect onboard spending.
- The balance sheet is thin for a large buyback. At 30 September 2026 the company held $32.1 million of cash and $80.9 million of total liquidity, against $70.5 million of debt net of financing costs (company 8-K). The $100 million program depends on surplus cash.
- A few cruise lines supply nearly all revenue. OneSpaWorld operated spas on 207 ships at the end of the third quarter, up from 204 a year earlier (Motley Fool, 28 October 2026). Those ships belong to a small number of operators, so losing one contract would hit sales directly.
Price setup
The shares closed at $26.92 on 13 August 2026, and the three-month gain to 11 November 2026 is 16.9% on adjusted closes. Most of that gain came after the 28 October 2026 report. Since then the shares have held in a narrow range. They closed at $31.29 on 4 November 2026 and $30.72 on 5 November 2026, reached a closing high of $32.47 on 9 November 2026, and closed at $31.42 on 11 November 2026.
The 52-week intraday high is $33.05, set on 9 November 2026, and the last close is 4.9% below it. The 50-day average is $24.69 and the 200-day average is $24.30. Both sit far below the price, which shows how far the post-report move has carried. The 52-week closing low is $19.37, from 28 January 2026.
The price has stalled in the low $30s while a director sold at an average of $31.33. A move back through the $33.05 high would mean buyers are paying more than the rest of 2026 is likely to justify, and the shares would be leading.
Catalysts ahead
- 18 November 2026: Record date for the raised $0.0625 quarterly dividend, payable 2 December 2026. This is the first payment at the 25% higher rate announced with the third-quarter results.
- ~17 December 2026 (est.): Carnival fiscal fourth-quarter report. The largest cruise operator's 2027 capacity, pricing and onboard spending outlook sets expectations for OneSpaWorld's revenue per ship.
- ~25 February 2027 (est.): OneSpaWorld fourth-quarter and full-year 2026 report. The report tests the fourth-quarter guidance and gives the first 2027 outlook, which has to support the higher share price.
What would change the view
A daily close above $34.56, which is above the $33.05 52-week intraday high of 9 November 2026 and would show the shares leading the S&P 500, proving this call wrong.
What it trades with
OneSpaWorld's revenue follows cruise passenger volume and onboard spending, so the shares tend to move with Carnival, Royal Caribbean and Norwegian Cruise Line Holdings. Results and outlooks from those operators are the main outside driver between OneSpaWorld's own reports. A broad sell-off in travel and leisure stocks would likely hit the shares whatever the company reports. The 2026 rise came from the company's own results more than from the sector.
The evidence, claim by claim (8)
- Third-quarter revenue rose 7% to $276.5M from $258.5M; adjusted EBITDA rose 12% to $39.2M from $35.0M. OneSpaWorld Q3 2026 results, Form 8-K Exhibit 99.1 · as of
- Average weekly revenue per ship was $99,965, up from $95,675; average ships in service were 206, up from 199. OneSpaWorld Q3 2026 results, Form 8-K Exhibit 99.1 · as of
- Fiscal 2026 guidance was raised to $1.033–1.038B revenue and $138–140M adjusted EBITDA, from $1.018–1.038B and $130–140M. OneSpaWorld Q3 2026 results, Form 8-K Exhibit 99.1 · as of
- A new $100M share repurchase program was approved after the $75M program was completed; about 1.41M shares were bought for $37.2M in Q3. OneSpaWorld Q3 2026 results, Form 8-K Exhibit 99.1 · as of
- Director Leonard Fluxman sold 150,611 shares in the open market at an average of $31.33 between 6 November 2026 and 9 November 2026. SEC Form 4 filed 10 November 2026 · as of
- Director Andrew Heyer sold 64,219 shares in the open market at an average of $30.02 between 20 August 2026 and 2 November 2026. SEC Form 4 filed 4 November 2026 · as of
- Stifel raised its price target to $35 and TD Cowen raised its target to $32 from $30, both keeping Buy ratings. Benzinga, 29 October 2026 · as of
- Norwegian Cruise Line Holdings' Q3 onboard and other revenue rose to $1.001B from $888.2M; Q4 net yield is guided down about 6.5% in constant currency. Baird Maritime, 29 October 2026 · as of
Sources
- Norwegian Cruise Line Holdings raises 2026 earnings forecast · bairdmaritime.com ·
- Why OneSpaWorld stock is up today · fool.com ·
- OneSpaWorld’s Cruise Ship Spas Ride A Record Run · finimize.com
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