Earnings Report
Carnival Corp (CCL - Free Report) released its second quarter earnings on Thursday before the bell. Its quarterly EPS of $0.66 beat our Zacks Consensus Estimates of $0.61. Reported quarterly revenue of $4.84 billion beating our $4.53 billion estimates by roughly 7%.
The part of the report that really affected CCL stock was its lowered guidance for fiscal 2019. Carnival decreased its fiscal 2019 EPS expectations from $4.35-$4.55 to $4.25-$4.35. The lowered guidance was a result of Carnival cruise cancellations due to necessary ship repairs, and the U.S. government’s policy change on travel to Cuba, which is resulting in lower revenue in the second half of the year. Additionally, revenue was cut due to headwinds for the company’s European brands.
Multiple analysts’ downgraded Carnival, including William Blair who dropped it to “Market Perform” from “Outperform.” Carnival is currently a Zacks Rank #3 (Hold).
Stocks Take a Hit
Although Carnival beat analyst estimates, its stock took a big hit. Following the release, Carnival’s stock opened down more than 9% this morning. Industry peers Royal Caribbean Cruises (RCL - Free Report) and Norwegian Cruise Lines Holdings (NCLH - Free Report) both fell over 3%. The UK brand of Carnival, Carnival UK (CUK - Free Report) , hit a new 52-week low of $45.06 today, also falling over 9%. This is the sixth time in a row Carnival’s stock has fallen following an earnings report.
CCL has fallen over 23% in the past 12 months and the earnings report shows there is little hope for a bounce back in the near future. Royal Caribbean and Norwegian Cruise Lines are expected to report their Q2 earnings in late July and early August, respectively. Their earnings reports could provide a better picture for the industry as a whole as some of Carnival’s lowered guidance was a result of company specific problems.
Bottom Line
Going into the second half of the year, Carnival is not looking good. The industry has underperformed compared to the S&P 500 for the past 6 quarters and Carnival’s pessimistic outlook does not help its stock or its peers’.
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Earnings Report
Carnival Corp (CCL - Free Report) released its second quarter earnings on Thursday before the bell. Its quarterly EPS of $0.66 beat our Zacks Consensus Estimates of $0.61. Reported quarterly revenue of $4.84 billion beating our $4.53 billion estimates by roughly 7%.
The part of the report that really affected CCL stock was its lowered guidance for fiscal 2019. Carnival decreased its fiscal 2019 EPS expectations from $4.35-$4.55 to $4.25-$4.35. The lowered guidance was a result of Carnival cruise cancellations due to necessary ship repairs, and the U.S. government’s policy change on travel to Cuba, which is resulting in lower revenue in the second half of the year. Additionally, revenue was cut due to headwinds for the company’s European brands.
Multiple analysts’ downgraded Carnival, including William Blair who dropped it to “Market Perform” from “Outperform.” Carnival is currently a Zacks Rank #3 (Hold).
Stocks Take a Hit
Although Carnival beat analyst estimates, its stock took a big hit. Following the release, Carnival’s stock opened down more than 9% this morning. Industry peers Royal Caribbean Cruises (RCL - Free Report) and Norwegian Cruise Lines Holdings (NCLH - Free Report) both fell over 3%. The UK brand of Carnival, Carnival UK (CUK - Free Report) , hit a new 52-week low of $45.06 today, also falling over 9%. This is the sixth time in a row Carnival’s stock has fallen following an earnings report.
CCL has fallen over 23% in the past 12 months and the earnings report shows there is little hope for a bounce back in the near future. Royal Caribbean and Norwegian Cruise Lines are expected to report their Q2 earnings in late July and early August, respectively. Their earnings reports could provide a better picture for the industry as a whole as some of Carnival’s lowered guidance was a result of company specific problems.
Bottom Line
Going into the second half of the year, Carnival is not looking good. The industry has underperformed compared to the S&P 500 for the past 6 quarters and Carnival’s pessimistic outlook does not help its stock or its peers’.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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