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Factors Setting the Tone for Carnival's (CCL) Q4 Earnings

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Carnival Corporation (CCL - Free Report) is scheduled to report fourth-quarter fiscal 2019 results on Dec 20. In the last reported quarter, the company delivered a positive earnings surprise of 4%. Furthermore, it came up with average trailing four-quarter beat of 6.2%.

How Are Estimates Faring?

The Zacks Consensus Estimate for earnings in the fiscal fourth quarter is pegged at 51 cents. Earnings estimates have been revised a penny upward over the past 30 days. This indicates a 27.1% decrease from 70 cents registered in the year-ago quarter. Revenues are expected at $4,605 million, suggesting a 3.3% rise from the year-earlier reported figure.

Factors at Play

Carnival’s top line in the quarter is likely to have benefited from robust performances of the company’s Onboard and Other segment. The Zacks Consensus Estimate for the segmental revenues stands at $1,362 million, hinting at 16.4% growth from the prior-year reported figure. This upside is expected to have been driven by higher onboard spending by guests.

However, soft performance of Passenger Tickets business might have negatively impacted the company’s performance. The Zacks Consensus Estimate for the segment’s revenues is pegged at $3,188 million, implying a 1.5% dip from the year-ago reported figure.

Moreover, increase in net cruise costs might have been a persistent concern. During the fourth quarter of fiscal 2019, net cruise costs (excluding fuel) per ALBD are expected to have risen 4-4.5% from the prior-year quarter in constant currency. Moreover, adverse currency translation along with macroeconomic issues in key operating regions is likely to have been a potent headwind.

Carnival Corporation Price and EPS Surprise

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 chances of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Carnival has an Earnings ESP of +5.20% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks With Favorable Combination

Here are some other companies worth considering as our model shows that these too have the right combination of elements to beat on earnings:

CarMax (KMX - Free Report) currently has an Earnings ESP of +0.21% and a Zacks Rank of 3.

General Mills, Inc. (GIS - Free Report) currently has an Earnings ESP of +0.19% and is Zacks #3 Ranked.

Hain Celestial (HAIN - Free Report) presently has an Earnings ESP of +6.74% and is a #3 Ranked stock.

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