Carnival Corporation is a leading cruise company, currently undervalued and trading at a forward P/E of 12.90, below the sector median. CCL posted its 11th consecutive double-beat quarter, with strong revenue and EPS growth, despite a brief negative market reaction post-earnings. A $36 price target suggests a 28% upside over the next 12 months, supported by high margins, steady growth, and robust industry demand.
CCL has reported the durable consumer demand for cruising, as observed in the raised FY2025 guidance and the management achieving the 2026 SEA Change targets 18 months ahead of schedule. This is on top of the excellent 2026 booking trends at higher prices and the growing customer deposits, significantly aided by the increased close-in demand. These reasons are also why CCL has felt confident to increase its investments in its new fleet through 2033 and private islands through 2026.
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Carnival (CCL) reported earnings 30 days ago. What's next for the stock?
The latest trading day saw Carnival (CCL) settling at $27.86, representing a -5.3% change from its previous close.
This company struggled mightily during the depths of the pandemic, but it's now generating revenue and earnings growth. Lower interest rates in the near term, coupled with favorable long-term industry tailwinds, support durable demand.
CCL's record yields, strong pricing, and cost discipline drive $2B in profit and its highest ROIC in nearly two decades.
The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price.
Carnival share price has pulled back in the past few weeks, moving from the year-to-date high of 2,205p in August to 1,924p today. It is hovering near its lowest level since July despite the ongoing demand for cruising.
Carnival gains the edge over Royal Caribbean as its destination-led model, debt reduction and rising yields fuel stronger momentum into 2025.
CCL shifts from fleet growth to destination-led strategy, using its Caribbean portfolio to power record yields and margins.