Shares of cruise line operator Carnival (CCL) are up in today’s trading as investors await its Q4 earnings results on December 20 before the market opens. Analysts are expecting earnings per share to come in at $0.07 on revenue of $5.93 billion. This equates to 200% and 9.8% year-over-year increases, respectively, according to TipRanks’ data.
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This is ideal because earnings per share should grow faster than revenue as it demonstrates a high degree of operating and financial leverage in the business. In addition, it’s worth noting that CCL has beaten earnings estimates in eight consecutive quarters.
Interestingly, CCL stock has recently received a wave of price target increases during the past few days. Most notably, UBS, led by five-star analyst Robin Farley, increased its price target from $24 to $31 per share while maintaining a Buy rating. The investment firm boosted its 2025 profit estimates based on higher expected revenue per cruise. UBS also predicts lower interest expenses if Carnival refinances its debt, as well as further growth from strong bookings and the launch of Celebration Key in late 2025.
What to Options Traders Anticipate for CCL Stock?
Using TipRanks’ Options tool, we can see what options traders are expecting from the stock immediately after its earnings report. The expected earnings move is determined by calculating the at-the-money straddle of the options closest to expiration after the earnings announcement. If this sounds complicated, don’t worry, the Options tool does this for you. Indeed, it currently says that options traders are expecting a 7.6% move in either direction.
Is CCL a Good Stock to Buy Now?
Overall, analysts have a Strong Buy consensus rating on CCL stock based on 16 Buys, three Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 41% rally in its share price over the past year, the average CCL price target of $27.32 per share implies 5.5% upside potential.
Interestingly, hedge funds seem to agree with analysts. When it comes to “smart money,” money managers seem to be confident in CCL stock. Indeed, hedge funds increased their holdings in the stock by 10 million shares during the last quarter. As a result, they have a very Positive confidence signal.
