In a report released yesterday, David Katz from Jefferies reiterated a Buy rating on Carnival (CCL – Research Report), with a price target of $31.00.
David Katz has given his Buy rating due to a combination of factors that highlight Carnival’s potential for value appreciation. One of the primary reasons is the current market pricing, which nearly aligns with recession estimates, suggesting that the stock is already heavily discounted. This presents an opportunity for upside if the economy stabilizes or improves.
Additionally, Katz’s analysis indicates that Carnival, along with Norwegian Cruise Line Holdings, has demonstrated resilience during past economic downturns, maintaining occupancy rates and positive EBITDA per passenger even when other sectors, like hotels, suffered significant declines. This historical performance, coupled with Carnival’s modest capacity growth and the inherent value proposition of cruising compared to land-based vacations, supports the Buy recommendation, as it suggests the company is well-positioned to weather potential macroeconomic challenges better than some of its peers.
CCL’s price has also changed moderately for the past six months – from $20.210 to $17.820, which is a -11.83% drop .