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Wolfe Research analyst Greg Badishkanian upgraded Carnival (CCL), Royal Caribbean (RCL), and Norwegian Cruise Line (NCLH) to Outperform from Peer Perform with price targets of $32, $94, and $36, respectively.

The upgrade of the "Big 3" public cruise stocks comes after his channel checks suggested improving booking and pricing trends out of North America over the past month, with stronger trends over the past week. While there is some lingering uncertainty surrounding the U.S. restart, the unknowns are "largely transitory when viewed against the broader reopening backdrop," Badishkanian tells investors in a research note.

Cumulative 2022 bookings are now up 10% to 15% versus 2019 levels with signs of improving Q1 demand, and pricing is up in the 15% to 25% range versus 2019 before factoring in future cruise credits, says the analyst. He expects pent-up demand and "normalized" capacity to support debt pay-down efforts.