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Carnival (CUK)
NYSE:CUK
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Carnival
(NYSE:CUK)
Rating:72Outperform
Price Target:
$20.50
▼(-3.57%Downside)
Carnival (CUK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$29.03B
Dividend YieldN/A
Average Volume (3M)1.67M
Price to Earnings (P/E)13.4
Beta (1Y)1.86
Revenue Growth12.66%
EPS Growth403.58%
CountryUS
Employees115,000
SectorConsumer Cyclical
Sector Strength73
IndustryLeisure
Share Statistics
EPS (TTM)0.13
Shares Outstanding188,478,060
10 Day Avg. Volume1,635,026
30 Day Avg. Volume1,673,898
Financial Highlights & Ratios
PEG Ratio0.01
Price to Book (P/B)2.88
Price to Sales (P/S)0.00
P/FCF Ratio13.23
Enterprise Value/Market Cap1.85
Enterprise Value/Revenue0.55
Enterprise Value/Gross Profit5.53
Enterprise Value/Ebitda2.27
Forecast
1Y Price Target
$20.00Price Target Upside-5.93% Downside
Rating ConsensusModerate Sell
Number of Analyst Covering0
Carnival Business Overview & Revenue Model
Company DescriptionCarnival Corporation & plc (CUK) is one of the world's largest leisure travel companies and a leading cruise operator. The company operates a portfolio of global cruise line brands, including Carnival Cruise Line, Princess Cruises, Holland America Line, and Seabourn, among others. With a diverse fleet of ships, Carnival offers vacation experiences to major destinations worldwide, catering to a wide range of travelers with various onboard activities, entertainment, dining options, and shore excursions.
How the Company Makes MoneyCarnival Corporation makes money primarily through ticket sales for its cruise vacations, which constitute a significant portion of its revenue. The company also generates substantial income from onboard spending, including sales in restaurants, bars, casinos, spas, and shops, as well as fees for shore excursions and other activities. Additionally, Carnival benefits from partnerships with travel agencies and tour operators, which facilitate bookings and enhance customer reach. The company's earnings are influenced by factors such as fuel prices, currency exchange rates, and global travel demand.
Carnival Earnings Call Summary
Earnings Call Date:Mar 21, 2025
(Q1-2025)
| % Change Since: 11.60%|
Next Earnings Date:Jun 19, 2025
Earnings Call Sentiment Positive
The earnings call indicates strong financial performance with record-breaking metrics in revenue and bookings. Despite some challenges in macroeconomic conditions and increased dry dock costs, the company shows resilience and strategic progress with successful refinancing and environmental goals.Q1-2025 Updates
Positive Updates
Record-Breaking Revenue and Growth
Achieved first-quarter high watermarks for revenue, EBITDA, EBITDA per ALBD, operating income, and customer deposits. Yield increased by 7.3%, exceeding guidance and showing strong demand.
Strong Demand and Bookings
Over 80% of the year booked at higher prices, with booking volumes for 2026 sailings reaching an all-time high. Historical high prices across all core programs for 2025.
Successful Refinancing Efforts
Refinanced $5.5 billion of debt, reducing annualized interest expense by $145 million and improving leverage metrics.
Environmental and Strategic Achievements
On track to achieve a 19% reduction in carbon intensity compared to 2019, with strong operational progress in environmental targets.
New Marketing Campaigns
Successful marketing campaigns across major brands, increasing brand consideration and achieving over 5 billion impressions.
Negative Updates
Macro-Economic Volatility Impact
Acknowledged not being immune to heightened macroeconomic and geopolitical volatility, which could impact booking trends.
Increased Dry Dock Costs
Higher dry dock costs due to unplanned dry docks and charter hire costs, affecting cruise costs.
Company Guidance
During the Carnival Corporation & plc's first quarter 2025 earnings call, the company provided positive guidance, highlighting several key metrics. The company reported a net income that exceeded guidance by over $170 million, driven by a robust 7.3% yield increase, which surpassed expectations. This performance was bolstered by strong demand and onboard spending, resulting in an EBITDA of $1.2 billion, marking a nearly 40% year-over-year increase. For the full year, Carnival raised its earnings guidance by $185 million, expecting yields to rise by 4.7%, despite macroeconomic challenges. Additionally, refinancing efforts are anticipated to save approximately $100 million, with plans to reduce debt by nearly $5 billion over the next two years. The company is on track to achieve its 2026 financial targets a year early, with ROIC expected to reach 12% and EBITDA per ALBD more than 50% higher than two years ago. Furthermore, Carnival is making significant marketing investments and has seen record booking volumes for 2026, demonstrating its strong market position and consumer demand.Carnival Financial Statement Overview
Summary
Carnival has demonstrated a strong recovery post-pandemic with significant revenue and profit growth, improving its overall financial health. However, the company remains highly leveraged, posing potential risks. The cash flow position is strengthening, providing better financial flexibility. Continued focus on managing debt and capital expenditures will be crucial to sustain long-term growth and stability.Income Statement
Carnival's income statement shows strong recovery with significant revenue growth from $12.2 billion in 2022 to $25.4 billion in TTM 2025, indicating a robust recovery post-pandemic. The gross profit margin improved substantially from a negative margin in 2021 to a healthy 38.2% in TTM 2025. The net profit margin has turned positive in TTM 2025 at 8.1%, showing improved profitability, although there is still room for growth. The EBIT and EBITDA margins are strong at 15.1% and 24.8% respectively. The overall trajectory is positive, but the company must maintain this growth to further strengthen its financial position.75
Positive
Balance Sheet
Carnival's balance sheet reveals a substantial debt load with a debt-to-equity ratio of 3.09 in TTM 2025, indicating high leverage, which is a potential risk. However, stockholders' equity has increased to $9.18 billion, improving the equity ratio to 19.3%. Return on Equity (ROE) is 22.3%, reflecting efficient use of shareholder funds. Despite improvements, the balance sheet remains leveraged, which could pose challenges if revenue growth slows.60
Neutral
Cash Flow
Carnival's cash flow statement shows positive momentum with operating cash flow of $5.08 billion in TTM 2025. Free cash flow has grown significantly to $1.99 billion, reflecting improved cash generation. The operating cash flow to net income ratio is strong at 2.47, indicating healthy cash generation relative to earnings. However, high capital expenditures remain a concern, impacting free cash flow growth. While there is positive progress, careful management of cash and expenses is essential.68
Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 25.43B | 25.02B | 21.59B | 12.17B | 1.91B | 5.59B | Gross Profit |
| 9.72B | 9.38B | 7.28B | 412.00M | -2.75B | -2.65B | EBIT |
| 3.84B | 3.57B | 1.96B | -4.38B | -7.09B | -8.87B | EBITDA |
| 6.31B | 6.23B | 4.37B | -2.20B | -5.69B | -7.12B | Net Income Common Stockholders |
| 2.05B | 1.92B | -74.00M | -6.09B | -9.50B | -10.24B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 833.00M | 1.21B | 2.42B | 4.03B | 9.14B | 9.51B | Total Assets |
| 48.53B | 49.06B | 49.12B | 51.70B | 53.34B | 53.59B | Total Debt |
| 28.39B | 28.88B | 31.89B | 35.88B | 34.61B | 28.38B | Net Debt |
| 27.56B | 27.67B | 29.48B | 31.85B | 25.67B | 18.87B | Total Liabilities |
| 39.35B | 39.81B | 42.24B | 44.64B | 41.20B | 33.04B | Stockholders Equity |
| 9.18B | 9.25B | 6.88B | 7.06B | 12.14B | 20.55B |
| Cash Flow | Free Cash Flow | ||||
| 1.99B | 1.30B | 997.00M | -6.61B | -7.72B | -9.92B | Operating Cash Flow |
| 5.08B | 5.92B | 4.28B | -1.67B | -4.11B | -6.30B | Investing Cash Flow |
| -2.98B | -4.54B | -2.81B | -4.77B | -3.54B | -3.24B | Financing Cash Flow |
| -3.51B | -2.58B | -5.09B | 3.58B | 6.95B | 18.65B |
Carnival Technical Analysis
Positive
21.26
Price Trends
17.99
Positive
20.10
Positive
19.54
Positive
Market Momentum
0.89
Negative
67.61
Neutral
56.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CUK, the sentiment is Positive. The current price of 21.26 is above the 20-day moving average (MA) of 19.27, above the 50-day MA of 17.99, and above the 200-day MA of 19.54, indicating a bullish trend. The MACD of 0.89 indicates Negative momentum. The RSI at 67.61 is Neutral, neither overbought nor oversold. The STOCH value of 56.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CUK.
Carnival Risk Analysis
Carnival disclosed 19 risk factors in its most recent earnings report. Carnival reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Carnival Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $28.87B | 14.82 | 25.87% | ― | 12.66% | 403.58% | |
74 Outperform | $1.90B | 29.14 | 12.80% | 0.65% | 9.80% | 89.42% | |
72 Outperform | $29.03B | 13.38 | 25.87% | ― | 12.66% | 403.58% | |
62 Neutral | $6.84B | 11.23 | 3.09% | 3.95% | 2.66% | -25.23% |
* Consumer Cyclical Sector Average
Performance Comparison
CUK
Carnival
21.26
7.14
50.57%
CCL
Carnival
23.60
7.95
50.80%
OSW
OneSpaWorld Holdings
19.26
4.28
28.57%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.