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Why Carnival (CCL) Dipped More Than Broader Market Today

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In the latest market close, Carnival (CCL - Free Report) reached $15.32, with a -1.79% movement compared to the previous day. The stock fell short of the S&P 500, which registered a loss of 0.2% for the day. Elsewhere, the Dow lost 0.15%, while the tech-heavy Nasdaq lost 0.34%.

The cruise operator's stock has dropped by 15.31% in the past month, falling short of the Consumer Discretionary sector's gain of 1.41% and the S&P 500's gain of 1.93%.

The investment community will be closely monitoring the performance of Carnival in its forthcoming earnings report. In that report, analysts expect Carnival to post earnings of $1.15 per share. This would mark year-over-year growth of 33.72%. Meanwhile, our latest consensus estimate is calling for revenue of $7.8 billion, up 13.73% from the prior-year quarter.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Carnival. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.47% upward. Currently, Carnival is carrying a Zacks Rank of #2 (Buy).

In terms of valuation, Carnival is currently trading at a Forward P/E ratio of 13.16. For comparison, its industry has an average Forward P/E of 18.6, which means Carnival is trading at a discount to the group.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 157, which puts it in the bottom 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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