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Why Is Carnival (CCL) Down 1% Since Last Earnings Report?
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It has been about a month since the last earnings report for Carnival (CCL - Free Report) . Shares have lost about 1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Carnival due for a breakout? 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 second-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.
The management expects net yields to exceed 10% and drive double-digit returns on invested capital.
Earnings & Revenues
In the quarter under review, the company reported an adjusted earnings per share (EPS) of 11 cents, beating the Zacks Consensus Estimate of a loss of 1 cent. In the year-ago quarter, the company reported an adjusted loss of 31 cents.
Revenues in the quarter totaled $5.8 billion, beating the consensus mark of $5.7 billion. In the prior-year quarter, CCL reported revenues of $4.9 billion.
In second-quarter fiscal 2024, passenger ticket revenues amounted to $3.8 billion, up from $3.1 billion reported in the prior-year quarter. Our estimate for passenger ticket revenues was $3.6 billion.
Onboard and other revenues increased to $2 billion, up from $1.8 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was $1.97 billion.
Q2 Financials
During the fiscal second quarter, the company reported a GAAP net income came in at $92 million against a loss of $407 million reported in the prior-year quarter. Adjusted net income in the quarter amounted to $134 million against a loss of $395 million reported in the year-ago quarter.
Balance Sheet
As of May 31, 2024, cash and cash equivalents were $1.6 billion compared with $2.4 billion as of Nov 30, 2023. Carnival ended the quarter with liquidity of $4.6 billion. Total debt (current and long-term) as of May 31, 2024, was $29.3 billion compared with $30.6 billion as of Nov 30, 2023.
Adjusted EBITDA, as of May 31, 2024, came in at $1.2 billion compared with $681 million reported in the prior-year quarter.
Bookings Update
The company reported strong booking momentum for 2025, with record volumes surpassing 2024 levels in both price and occupancy. During the fiscal second quarter, the company reported higher pricing on bookings courtesy of the limited remaining inventory for 2024. It reported strength in pricing for the North America and Australia (NAA) and Europe segments for the third and fourth quarters of 2024 on a year-over-year basis. The company's efforts to extend the booking curve and leverage favorable pricing trends resulted in record cumulative bookings for the remainder of 2024, with occupancy rates above 2023 levels.
Total customer deposits as of May 31 were $8.3 billion compared with $7 billion reported in the previous quarter. The amount was higher than $7.2 billion reported on May 31, 2023.
2024 Outlook
For third-quarter fiscal 2024, the company expects adjusted EBITDA to be approximately $2.66 billion. It expects fiscal second-quarter adjusted net income to be nearly $1.58 billion. The company expects fiscal third-quarter adjusted EPS to be $1.15.
For fiscal 2024, the company anticipates adjusted EBITDA to be approximately $5.83 billion compared with the previous expectation of $5.63 billion. Adjusted net income during the year is anticipated to be nearly $1.55 billion, up from the previous expectation of $1.3 billion. In the fiscal 2024, the company expects adjusted EPS to be $1.18 compared with the previous expectation of 98 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
VGM Scores
Currently, Carnival has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% 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 trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Carnival has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Carnival (CCL) Down 1% Since Last Earnings Report?
It has been about a month since the last earnings report for Carnival (CCL - Free Report) . Shares have lost about 1% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Carnival due for a breakout? 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 Beats Q2 Earnings Estimates, Raises '24 View
Carnival reported impressive second-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.
The management expects net yields to exceed 10% and drive double-digit returns on invested capital.
Earnings & Revenues
In the quarter under review, the company reported an adjusted earnings per share (EPS) of 11 cents, beating the Zacks Consensus Estimate of a loss of 1 cent. In the year-ago quarter, the company reported an adjusted loss of 31 cents.
Revenues in the quarter totaled $5.8 billion, beating the consensus mark of $5.7 billion. In the prior-year quarter, CCL reported revenues of $4.9 billion.
In second-quarter fiscal 2024, passenger ticket revenues amounted to $3.8 billion, up from $3.1 billion reported in the prior-year quarter. Our estimate for passenger ticket revenues was $3.6 billion.
Onboard and other revenues increased to $2 billion, up from $1.8 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was $1.97 billion.
Q2 Financials
During the fiscal second quarter, the company reported a GAAP net income came in at $92 million against a loss of $407 million reported in the prior-year quarter. Adjusted net income in the quarter amounted to $134 million against a loss of $395 million reported in the year-ago quarter.
Balance Sheet
As of May 31, 2024, cash and cash equivalents were $1.6 billion compared with $2.4 billion as of Nov 30, 2023. Carnival ended the quarter with liquidity of $4.6 billion. Total debt (current and long-term) as of May 31, 2024, was $29.3 billion compared with $30.6 billion as of Nov 30, 2023.
Adjusted EBITDA, as of May 31, 2024, came in at $1.2 billion compared with $681 million reported in the prior-year quarter.
Bookings Update
The company reported strong booking momentum for 2025, with record volumes surpassing 2024 levels in both price and occupancy. During the fiscal second quarter, the company reported higher pricing on bookings courtesy of the limited remaining inventory for 2024. It reported strength in pricing for the North America and Australia (NAA) and Europe segments for the third and fourth quarters of 2024 on a year-over-year basis. The company's efforts to extend the booking curve and leverage favorable pricing trends resulted in record cumulative bookings for the remainder of 2024, with occupancy rates above 2023 levels.
Total customer deposits as of May 31 were $8.3 billion compared with $7 billion reported in the previous quarter. The amount was higher than $7.2 billion reported on May 31, 2023.
2024 Outlook
For third-quarter fiscal 2024, the company expects adjusted EBITDA to be approximately $2.66 billion. It expects fiscal second-quarter adjusted net income to be nearly $1.58 billion. The company expects fiscal third-quarter adjusted EPS to be $1.15.
For fiscal 2024, the company anticipates adjusted EBITDA to be approximately $5.83 billion compared with the previous expectation of $5.63 billion. Adjusted net income during the year is anticipated to be nearly $1.55 billion, up from the previous expectation of $1.3 billion. In the fiscal 2024, the company expects adjusted EPS to be $1.18 compared with the previous expectation of 98 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in estimates revision.
VGM Scores
Currently, Carnival has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% 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 trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Carnival has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.