Shares of Carnival Corp. (CCL) slipped in trading on Monday even after the company announced better-than-expected Q3 results and raised its FY24 guidance. The cruise operator reported adjusted earnings of $1.27 per share, compared to $0.86 per share in the same period last year. This was higher than analysts’ estimates of earnings of $1.17 per share.
CCL’s Q3 Revenues Hit All-Time High
The company’s Q3 revenues hit an all-time high of $7.9 billion, marking a 15.2% increase year-over-year, and exceeded consensus estimates of $7.8 billion. Furthermore, the cruise operator saw robust bookings for future sailings. In fact, the company’s management commented, “Nearly half of 2025 [is] booked and less inventory remaining for sale than the prior year, we are leveraging strong demand to achieve record ticket pricing (in constant currency).”
Booking volumes remained high during the third quarter for cruises in 2025, with bookings made at higher prices (on a constant currency basis) compared to the previous year.
CCL Raises FY24 Forecast
Looking ahead, CCL has raised its FY24 forecast and now expects adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) to reach around $6 billion, reflecting a 40% increase year-over-year. The company has also projected an adjusted return on invested capital (ROIC) of approximately 10.5%. Adjusted ROIC is a profitability metric that measures how much adjusted earnings a business generates for each dollar of invested capital.
In the fourth quarter, CCL forecasts an adjusted EBITDA of around $1.14 billion, which is up 20% year-over-year. Additionally, the company warns that it anticipates adjusted cruise costs, excluding fuel, to increase by 8% year-over-year. This rise is largely due to an increase in maintenance days for its ships, along with higher spending on advertising.
Is CCL a Good Stock to Buy Now?
Analysts remain cautiously optimistic about CCL stock, with a Moderate Buy consensus rating based on five Buys and one Hold and Sell each. Over the past year, CCL has increased by more than 30%, and the average CCL price target of $23 implies an upside potential of 24.4% from current levels. These analyst ratings are likely to change following CCL’s results today.
