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Carnival (CCL) Up 22.6% Since Last Earnings Report: Can It Continue?
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It has been about a month since the last earnings report for Carnival (CCL - Free Report) . Shares have added about 22.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carnival due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Carnival reported impressive third-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. The upside was primarily backed by sustained demand strength and increased booking volumes.
Owing to strong demand and cost-saving opportunities, the company raised its full-year 2024 adjusted EBITDA guidance. Management expects net yields, at constant currency, to increase around 10.4% compared with 2023 levels, exceeding the prior guidance provided in June due to strong demand.
CCL’s Earnings & Revenues
In the quarter under review, the company reported adjusted earnings per share (EPS) of $1.27, beating the Zacks Consensus Estimate of $1.17. In the year-ago quarter, CCL posted adjusted earnings of 86 cents.
Revenues in the quarter totaled $7.9 billion, beating the consensus mark of $7.8 billion. In the prior-year quarter, CCL registered revenues of $6.9 billion.
In third-quarter fiscal 2024, passenger ticket revenues amounted to $5.2 billion, up from $4.5 billion reported in the prior-year quarter. Our estimate for passenger ticket revenues was $4.9 billion.
Onboard and other revenues increased to $2.7 billion from $2.3 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was pegged at $2.8 billion.
Q3 Financials
During the fiscal third quarter, the company’s GAAP net income came in at $1.7 billion compared with $1.1 billion reported in the prior-year quarter. Adjusted net income in the quarter amounted to $1.8 billion compared with $1.2 billion reported in the year-ago quarter. Adjusted EBITDA totaled $2.8 billion, up 27.1% from $2.2 billion in the prior-year quarter.
Balance Sheet
As of Aug. 31, 2024, cash and cash equivalents were $1.5 billion compared with $2.4 billion as of Nov. 30, 2023. Carnival ended the quarter with liquidity of $4.5 billion. Total debt (current and long-term) as of Aug. 31, 2024, was $28.9 billion compared with $30.6 billion as of Nov 30, 2023.
Bookings Update
During the quarter, the company reported strong booking momentum for 2025, with volumes remaining robust at higher prices compared to the prior year. Nearly half of 2025 is already booked, with less inventory available than last year. The company is leveraging this demand to achieve record ticket pricing. Bookings for 2026 have also started strong, with record volumes in the past three months.
Total customer deposits as of Aug. 31 were $6.8 billion compared with $8.3 billion reported in the previous quarter. The amount was higher than $6.3 billion reported on Aug. 31, 2023.
Q4 & 2024 Outlook
For fourth-quarter fiscal 2024, the company expects adjusted EBITDA to be approximately $1.14 billion, up 20% from the year-ago quarter’s level. It expects fiscal fourth-quarter adjusted net income to be nearly $60 million. The company expects fiscal fourth-quarter adjusted EPS to be 5 cents.
For the fiscal 2024, the company anticipates adjusted EBITDA to be approximately $6 billion compared with the previous expectation of $5.83 billion. Adjusted net income during the year is anticipated to be nearly $1.76 billion, up from the previous expectation of $1.55 billion. In the fiscal 2024, the company expects adjusted EPS to be $1.33 compared with the previous expectation of $1.18.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted -17.62% due to these changes.
VGM Scores
Currently, Carnival has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise Carnival has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Carnival (CCL) Up 22.6% Since Last Earnings Report: Can It Continue?
It has been about a month since the last earnings report for Carnival (CCL - Free Report) . Shares have added about 22.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Carnival due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Carnival Tops Q3 Earnings & Revenue Estimates, Rise Y/Y
Carnival reported impressive third-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. The upside was primarily backed by sustained demand strength and increased booking volumes.
Owing to strong demand and cost-saving opportunities, the company raised its full-year 2024 adjusted EBITDA guidance. Management expects net yields, at constant currency, to increase around 10.4% compared with 2023 levels, exceeding the prior guidance provided in June due to strong demand.
CCL’s Earnings & Revenues
In the quarter under review, the company reported adjusted earnings per share (EPS) of $1.27, beating the Zacks Consensus Estimate of $1.17. In the year-ago quarter, CCL posted adjusted earnings of 86 cents.
Revenues in the quarter totaled $7.9 billion, beating the consensus mark of $7.8 billion. In the prior-year quarter, CCL registered revenues of $6.9 billion.
In third-quarter fiscal 2024, passenger ticket revenues amounted to $5.2 billion, up from $4.5 billion reported in the prior-year quarter. Our estimate for passenger ticket revenues was $4.9 billion.
Onboard and other revenues increased to $2.7 billion from $2.3 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was pegged at $2.8 billion.
Q3 Financials
During the fiscal third quarter, the company’s GAAP net income came in at $1.7 billion compared with $1.1 billion reported in the prior-year quarter. Adjusted net income in the quarter amounted to $1.8 billion compared with $1.2 billion reported in the year-ago quarter. Adjusted EBITDA totaled $2.8 billion, up 27.1% from $2.2 billion in the prior-year quarter.
Balance Sheet
As of Aug. 31, 2024, cash and cash equivalents were $1.5 billion compared with $2.4 billion as of Nov. 30, 2023. Carnival ended the quarter with liquidity of $4.5 billion. Total debt (current and long-term) as of Aug. 31, 2024, was $28.9 billion compared with $30.6 billion as of Nov 30, 2023.
Bookings Update
During the quarter, the company reported strong booking momentum for 2025, with volumes remaining robust at higher prices compared to the prior year. Nearly half of 2025 is already booked, with less inventory available than last year. The company is leveraging this demand to achieve record ticket pricing. Bookings for 2026 have also started strong, with record volumes in the past three months.
Total customer deposits as of Aug. 31 were $6.8 billion compared with $8.3 billion reported in the previous quarter. The amount was higher than $6.3 billion reported on Aug. 31, 2023.
Q4 & 2024 Outlook
For fourth-quarter fiscal 2024, the company expects adjusted EBITDA to be approximately $1.14 billion, up 20% from the year-ago quarter’s level. It expects fiscal fourth-quarter adjusted net income to be nearly $60 million. The company expects fiscal fourth-quarter adjusted EPS to be 5 cents.
For the fiscal 2024, the company anticipates adjusted EBITDA to be approximately $6 billion compared with the previous expectation of $5.83 billion. Adjusted net income during the year is anticipated to be nearly $1.76 billion, up from the previous expectation of $1.55 billion. In the fiscal 2024, the company expects adjusted EPS to be $1.33 compared with the previous expectation of $1.18.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates review.
The consensus estimate has shifted -17.62% due to these changes.
VGM Scores
Currently, Carnival has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. It comes with little surprise Carnival has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.