Carnival (CUK) AI Stock Analysis

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Carnival

(NYSE:CUK)

69Neutral

Carnival's overall stock score reflects its strong financial recovery and positive earnings outlook, bolstered by increased demand and strategic refinancing efforts. However, high leverage and technical indicators suggest caution. The company’s reasonable valuation supports its stability, but the absence of a dividend yield may limit appeal to certain investors.

Carnival (CUK) vs. S&P 500 (SPY)

Market Cap

$23.10B

Dividend YieldN/A

Average Volume (3M)2.21M

Price to Earnings (P/E)10.7

Beta (1Y)1.88

Revenue Growth12.66%

EPS Growth403.58%

CountryUS

Employees115,000

SectorConsumer Cyclical

Sector Strength63

IndustryLeisure

Share Statistics

EPS (TTM)1.50

Shares Outstanding188,255,650

10 Day Avg. Volume2,300,895

30 Day Avg. Volume2,210,143

Financial Highlights & Ratios

PEG Ratio0.03

Price to Book (P/B)N/A

Price to Sales (P/S)1.13

Price to Cash Flow (P/CF)7.80

P/FCF Ratio7.80

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$20.00

Price Target Upside24.38% Upside

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 Financial Statement Overview

Summary

Carnival has shown a strong recovery post-pandemic with significant revenue and profit growth. The income statement indicates robust recovery and profitability improvements. However, the balance sheet reveals high leverage with a debt-to-equity ratio of 3.09, posing potential risks. The cash flow position is strengthening, but high capital expenditures are a concern. Overall, financial performance is positive, yet maintaining growth and managing debt are crucial.

Income Statement

Positive

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.

Balance Sheet

Neutral

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.

Cash Flow

Positive

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.

TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
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
6.32B	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
753.00M	1.21B	2.42B	4.03B	9.14B	9.51B
	Total Assets
36.73B	48.28B	49.12B	51.70B	53.34B	53.59B
	Total Debt
10.64B	28.88B	31.89B	35.88B	34.61B	28.38B
	Net Debt
9.89B	27.67B	29.48B	31.85B	25.67B	18.87B
	Total Liabilities
15.31B	39.03B	42.24B	44.64B	41.20B	33.04B
	Stockholders Equity
21.42B	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

Technical Analysis Sentiment

Negative

Last Price16.08

Price Trends

50DMA

19.83

Negative

100DMA

21.50

Negative

200DMA

19.18

Negative

Market Momentum

MACD

-1.10

Negative

RSI

41.15

Neutral

STOCH

52.00

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CUK, the sentiment is Negative. The current price of 16.08 is below the 20-day moving average (MA) of 17.37, below the 50-day MA of 19.83, and below the 200-day MA of 19.18, indicating a bearish trend. The MACD of -1.10 indicates Negative momentum. The RSI at 41.15 is Neutral, neither overbought nor oversold. The STOCH value of 52.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative 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 (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OSW	73 Outperform	$1.80B	24.79	14.74%	0.70%	12.72%	―
CUK	69 Neutral	$23.10B	10.71	25.87%	―	12.66%	403.58%
CCL	61 Neutral	$22.85B	11.75	25.87%	―	12.66%	403.58%
Sector *	59 Neutral	$11.53B	10.43	-0.22%	4.02%	1.19%	-15.83%

* Consumer Cyclical Sector Average

Performance Comparison

CUK

Carnival

16.08

3.52

28.03%

CCL

Carnival

17.82

3.92

28.20%

OSW

OneSpaWorld Holdings

17.21

4.91

39.92%

Carnival Earnings Call Summary

Earnings Call Date: Mar 21, 2025 | % Change Since: -15.59% | 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.

Highlights

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.

Lowlights

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.

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.