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Cruise lines are reinstating dividends after record profits
Theme 1: Silver Mining Surge on All-Time Price Highs and Critical Material Designation
The silver market faces a perfect storm of supply constraints and demand acceleration. On the supply side, five consecutive years of deficits have drained inventories on major exchanges like the London Metal Exchange and COMEX to historic lows. Meanwhile, demand continues surging from price-inelastic industrial applications, particularly solar photovoltaic installations driving renewable energy adoption and electric vehicle manufacturing requiring silver for electrical components.
The U.S. government's critical material designation signals potential future policies supporting domestic supply and higher prices. When silver prices rise, mining companies benefit disproportionately since their fixed costs remain stable while incremental revenue flows directly to profit margins, creating powerful operational leverage.
Stocks that would benefit:
WPM: Wheaton Precious Metals Corp - Leading precious metals streaming company with significant silver exposure that captures the upside of rising silver prices without the operational risks of mining. Their 100% streaming model delivered record Q3 2025 revenue of $476 million (+55% YoY) while maintaining fixed per-ounce payments, allowing for substantial margin expansion as silver prices surge. With 39% of Q3 revenue derived from silver streams, WPM is uniquely positioned to benefit from the structural supply deficits in the silver market while maintaining a debt-free balance sheet that enables continued acquisition of new silver streams. Read More →
CDE: Coeur Mining Inc - Transformed from a capital-intensive, debt-laden miner to a free cash flow powerhouse generating approximately $2 million per day in Q3 2025. The company's Rochester expansion has established it as "America's largest source of domestically produced and refined silver," directly benefiting from the U.S. government's critical material designation. Coeur's balanced portfolio approach spreads operating risk across multiple jurisdictions while maintaining significant silver leverage, with projected 62% year-over-year revenue growth directly tied to silver's price appreciation and industrial demand surge. Read More →
EXK: Endeavour Silver Corporation - Pure-play silver producer with transformational growth through its flagship Terronera mine, which reached commercial production in October 2025. As a primary silver miner with operations in Mexico, Endeavour provides concentrated exposure to silver price movements with minimal base metal credits. The company is positioned to benefit from the structural silver deficit as Terronera ramps up to become a low-cost, long-life operation generating positive free cash flow in Q4 2025 and Q1 2026, directly capitalizing on silver's industrial demand growth from solar and EV applications. Read More →
Theme 2: Cruise Line Recovery on Carnival's Record Profits and Dividend Restoration
Carnival's exceptional results demonstrate the cruise industry's transformation into a mainstream vacation alternative with durable demand characteristics. The company achieved full-year yield improvements of over 5.5%, exceeding initial guidance, while generating substantial cash flow that enabled balance sheet improvements to investment-grade leverage ratios of 3.4 times.
The dividend reinstatement signals management confidence in sustained cash generation, while 2026 booking positions remain at record levels with historical high pricing. Cruise lines benefit from high operational leverage where incremental passengers generate substantial marginal profits since ship capacity and crew costs remain largely fixed.
Stocks that would benefit:
CCL: Carnival Corporation - Industry leader demonstrating the earnings power of operational leverage with record $3 billion in net income for 2025, a 60% increase over 2024 and 30% above initial guidance. The company's transformation from survival mode to optimization is complete, with refinancing of over $11 billion in debt since January 2025 generating $145 million in annualized interest savings and reducing net debt to EBITDA to 3.6 times. Carnival's record pricing power is driving the story with Q3 2025 yields increasing 4.6% on a same-ship basis despite 2.5% lower capacity, demonstrating that yield growth stems from fundamental demand strength rather than capacity expansion, positioning the company for continued double-digit earnings growth in 2026. Read More →
RCL: Royal Caribbean Group - Transformed from a traditional cruise operator into an integrated vacation ecosystem where innovative ships, exclusive private destinations, and AI-driven digital engagement create a self-reinforcing cycle of loyalty and pricing power. The company achieved investment-grade metrics 18 months ahead of schedule while delivering record Q3 2025 results ($5.1B revenue, $1.6B net income), proving its heavy capital investment cycle is generating returns rather than just capacity. Royal Caribbean's private destinations are serving as margin accelerators, with Perfect Day at CocoCay alone generating $600M in revenue in 2026 with premium margins, creating captive revenue streams that competitors cannot easily replicate. Read More →
NCLH: Norwegian Cruise Line Holdings - Executing a deliberate pricing strategy targeting families with third/fourth guests on short Caribbean sailings that is boosting load factors above 106% and expanding adjusted EBITDA margins to 36.7% (trailing twelve months), on track to reach 39% by 2026. This counterintuitive approach proves that occupancy gains and onboard revenue can more than offset ticket price dilution. The company is simultaneously refinancing expensive debt, upsizing its revolver to $2.5 billion, and chartering out four older vessels to third-party operators, which reduces fleet age and positions net leverage to fall from 5.3x at 2025 year-end to the mid-4x range in 2026, despite $2.7 billion in ship deliveries over the next two years. Read More →
Theme 3: Auto Financing Recovery on Used Vehicle Sales Strength and Credit Market Normalization
The auto financing sector is experiencing a fundamental improvement in operating conditions. Higher used-vehicle inventory levels of 2.31 million units provide adequate supply to meet consumer demand, while month-over-month sales growth of 2.3% indicates healthy transaction volumes that directly translate to financing opportunities.
Auto lenders benefit from this environment through increased loan originations, while normalized inventory levels reduce the price volatility that created credit risks during supply shortage periods. Better-than-expected 2025 auto sales performance suggests consumer demand for vehicle financing remains robust despite broader economic concerns.
Stocks that would benefit:
CACC: Credit Acceptance Corporation - Specialized auto finance company deliberately sacrificing market share (down to 5.1% from 6.5%) to protect margins in the subprime auto market, with Q3 2025 net income rising 37% despite a 16.5% decline in loan unit volume. The company's 2024 scorecard tightening has reduced advance rates and compressed volumes, but yields have expanded to 27% and credit provisions have improved, demonstrating that its underwriting discipline is working effectively in the normalized used vehicle market. Credit Acceptance is making heavy investments in technology infrastructure—modernizing loan origination systems and accelerating feature delivery by 70%—positioning the company to capture market share when the credit cycle turns more favorable while maintaining pricing discipline in the current environment. Read More →
ALLY: Ally Financial - Transformed into a focused auto finance and digital banking pure-play through strategic simplification, exiting credit cards, mortgage originations, and point-of-sale lending. This strategic focus is directly enabling margin expansion to 3.45-3.5% NIM and positioning the company to deliver mid-teens ROTCE from a current 4.25% base. Ally is experiencing a credit quality inflection point with retail auto net charge-offs trending toward 2% (low end of guidance), reflecting the payoff of 2023 underwriting tightening and enhanced digital servicing capabilities. This suggests the $619 million year-to-date provision reduction is structural rather than cyclical, with further upside as delinquencies normalize in the improving used vehicle sales environment. Read More →
GM: General Motors Financial - Captive finance arm benefiting from GM's strategic pivot from capital-intensive robotaxi dreams to a software-enabled mobility platform, with $5 billion in deferred revenue from Super Cruise and connected services pointing to a recurring revenue model. The finance unit is directly leveraging improved vehicle sales into financing volume growth while maintaining strong credit quality. GM Financial's ability to offset 30-35% of tariff impacts through manufacturing flexibility and cost initiatives demonstrates operational resilience, with Q3 2025 margins hitting 9% ex-tariffs—within the historical 8-10% target range despite a $1.1 billion gross tariff headwind, creating a stable environment for the financing arm to expand originations as vehicle sales exceed expectations. Read More →
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