Carnival today
Carnival Co. And
(As of 12/20/2024 5:45 PM ET)
- 52 week range
- $13.78
▼
$27.17
- P/E ratio
- 23.93
- Target price
- $26.62
Carnival Cruise Lines’ New York Stock Exchange: CCL The share price is expected to rise around 50% in 2024 and rise in the second half as the business is strong. FY2025 details include sustained growth following industry normalization, record results and improved guidance. Results include healthy cash flow, an improved balance sheet and prospects for repaying investment-grade debt. The end result is that financial health is improving and is expected to continue to improve to the point where dividend payments may soon be reinstated, with share repurchases becoming an important catalyst for increasing shareholder value.
Party for carnival guests, just like it’s 1999
Carnival Cruise Lines posted a strong quarter in the fourth quarter, with revenue up 10% to a record. The growth was driven by sales volume, ticket prices and on-board spending, all of which reached record levels. Revenue is supported by operational efficiencies and improved profitability metrics, with costs growing less than revenue. The company’s gross margin increased approximately 2,000 basis points, offsetting operating losses recorded in the prior year. Adjusted EBITDA was $1.2 billion, a record high and up nearly 30% year over year.
The outlook is strong and will likely cause analysts to reconsider results and sentiment on the stock. The company said customer bookings were at a record level in the fourth quarter and continued to grow, driven by ticket sales and additional in-flight services. Advance bookings are also at record levels through 2026, with EBITDA per bottom stand expected to reach a two-decade high. Adjusted net income is expected to be +20% in 2025, which could be a conservative estimate given travel trends.
As strong as the business trends are, the improvements in the balance sheet are more impressive. The company paid off $3.3 billion in debt, bringing its total debt since its peak to nearly $8 billion. Year-end balance sheet highlights included a reduction in the cash position, offset by strong cash flow, and a reduction in debt and liabilities, resulting in a significant increase in equity. Shareholders’ equity is up 50% and is likely to continue to grow as debt is paid off and the balance sheet is restored to its previous strength. In terms of leverage, long-term debt is less than 3x equity, which is a good ratio for any stock.
Analyst tailwind unlikely to end in 2025
Carnival Co. and stock forecast today
$26.62
-0.68% DisadvantageModerate purchase
Based on ratings from 18 analysts
| High forecast | $32.00 |
|---|---|
| Average forecast | $26.62 |
| Low forecast | US$16.50 |
Carnival Co stock forecast details.
Analyst trends have been positive for Carnival for more than a year, with increased coverage, improving sentiment and an upward trend in the consensus price target. These trends are unlikely to end now that the F2025 forecast has been released, and are likely to intensify. Until then, the consensus of 18 analysts tracked by MarketBeat is a Moderate Buy, with a price target of $26.60. The $26.60 price target suggests the stock is fairly priced at its mid-December high, but revision trends suggest a move above $30 is likely, with a multi-year high set in 2025.
Institutional activity is equally optimistic. Institutions have rebalanced these stocks every quarter of 2024, with dollar volume of purchases outpacing sales by a 2:1 ratio. These institutions own more than 65% of the shares and provide a strong upward price flow.
Carnival cruise line prices could reach $40 in 2025
Technical indicators for Carnival Cruise Line are bullish. After a brief consolidation, the stock rallied in H2 2024 and showed support at the 30-day EMA. Confirmed support at the 30-day EMA suggests the uptrend will continue and possibly extend the $5-$13 rally. The $5 upgrade is in line with analyst revision trends, while the $13 price target is in line with pre-COVID price levels where its financial health suggests it should trade.
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