Carnival: Positive Trajectory

 

  • Carnival reported FQ2'22 results showing a positive trajectory in the business, though far from perfect.
  • The cruise line indicated strong booking trends for 2023 as consumers are able to plan for trips without worries of travel restrictions.
  • The stock is cheap at $10 with normalized earnings at $3 per share, as debt is repaid and interest expenses are cut.
  • This idea was discussed in more depth with members of my private investing community, Out Fox The Street. Learn More » 
In no huge surprise, Carnival Corp. (NYSE:CCL) reported a quarter of improving results. The largest cruise line didn't report a perfect quarter, but the company and the sector continues to head back to more normal times in the travel and leisure sector. My investment thesis is very Bullish on the stock after the dip back towards the COVID lows, which was ill-timed considering the dynamics of the business are far improved now.

Read the full article on Seeking Alpha. 

Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Update - June 29

Bizarre and inappropriate panic caused by MS analysts making the claim CCL could fall to $0 on another demand shock. In addition, Carnival just talked about strong bookings, so this call is far off base. 

-Carnival Corporation (NYSE:CCL) fell sharply in early trading after Morgan Stanley slashed earnings estimates.

-Analyst Jamie Rollo and team reduced the FY22 EBITDA forecast to -$900M from $900M, which would mark a third straight year of losses for the cruise line operator. The FY23 EBITDA forecast was reduced to $5.0B on the expectation for weaker pricing/occupancies and elevated costs.

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