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Carnival (CCL) Ascends But Remains Behind Market: Some Facts to Note

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In the latest market close, Carnival (CCL - Free Report) reached $27.19, with a +0.37% movement compared to the previous day. This move lagged the S&P 500's daily gain of 0.39%. On the other hand, the Dow registered a gain of 0.71%, and the technology-centric Nasdaq increased by 0.2%.

Shares of the cruise operator witnessed a gain of 13.63% over the previous month, beating the performance of the Consumer Discretionary sector with its gain of 2.35% and the S&P 500's gain of 1.7%.

The investment community will be paying close attention to the earnings performance of Carnival in its upcoming release. The company is expected to report EPS of $0.02, up 114.29% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $5.75 billion, up 6.34% from the prior-year quarter.

For the full year, the Zacks Consensus Estimates project earnings of $1.77 per share and a revenue of $26.01 billion, demonstrating changes of +24.65% and +3.97%, respectively, from the preceding year.

Investors might also notice recent changes to analyst estimates for Carnival. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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 moved 2.62% higher. Carnival is currently a Zacks Rank #2 (Buy).

From a valuation perspective, Carnival is currently exchanging hands at a Forward P/E ratio of 15.31. This indicates a discount in contrast to its industry's Forward P/E of 19.81.

It's also important to note that CCL currently trades at a PEG ratio of 0.84. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Leisure and Recreation Services was holding an average PEG ratio of 0.84 at yesterday's closing price.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This group has a Zacks Industry Rank of 62, putting it in the top 25% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming 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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