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Factors Setting the Tone for Carnival's (CCL) Q1 Earnings

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Carnival Corporation (CCL - Free Report) is scheduled to report first-quarter fiscal 2021 business update on Apr 7. In the last reported quarter, the company reported a negative earnings surprise of 5.2%.

Trend in Estimate Revision

The Zacks Consensus Estimate for the fiscal first quarter bottom line is pegged at a loss of $1.66 per share. In the prior-year quarter, the company reported earnings per share of 22 cents. The consensus mark for revenues is pegged at $108 million, suggesting a decline of 97.7% from the year-ago quarter’s reported figure.

Carnival Corporation Price and EPS Surprise


Carnival Corporation Price and EPS Surprise

Carnival Corporation price-eps-surprise | Carnival Corporation Quote


Factors at Play

Carnival’s fiscal first-quarter results are likely to have been adversely impacted by the coronavirus pandemic. Notably, cancellations of cruises due to the ongoing crisis and change in booking patterns are likely to get reflected in the company’s results for the to-be-reported quarter. This along with a decline in passenger ticket revenues as well as onboard and other revenues on account of limited cruise operations are likely to have affected overall top line.

Moreover, rise in capital expenditures is likely to have dented fiscal first-quarter top-line. Notably, the company expects cash burn of approximately $600 million per month.

However, phased resumption of operations coupled with shorter-duration cruises is likely to have aided the company in the to-be-reported quarter. This along with focus on development of low-cost testing model, the continued advent of therapies and the pace of the distribution of vaccines are likely to have influenced the pace of recovery in the fiscal first quarter.

What the Zacks Model Unveils

Our proven model predicts an earnings beat for Carnival this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat.

Earnings ESP: Carnival has an Earnings ESP +10.57%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks Poised to Beat Earnings Estimates

Here are some stocks from the Zacks Consumer Discretionary space that investors may consider, as our model shows that these have the right combination of elements to post an earnings beat in the quarter to be reported:

Hasbro, Inc. (HAS - Free Report) has a Zacks Rank #3 and an Earnings ESP of +3.21%.

Boyd Gaming Corporation (BYD - Free Report) has a Zacks Rank #3 and an Earnings ESP of +4.17%.

Las Vegas Sands Corp. (LVS - Free Report) has a Zacks #3 and an Earnings ESP of +2.78%

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