On Monday, Tigress Financial Partners increased its price target on Carnival Corporation (NYSE:CCL) shares to $28.00 and maintained a Buy rating. The firm highlighted Carnival's record quarterly results, driven by robust demand for cruises and consumer travel spending. Carnival reported a 14.49% year-over-year increase in Q3 2024 revenue, reaching a record $7.9 billion. This surge was attributed to higher net yields and record net per diems, significantly surpassing 2023 figures.
Carnival's cumulative advanced bookings for the fiscal year 2025 are already outpacing the previous year's record, with higher prices as well. The company has also achieved cost savings, with adjusted cruise costs excluding fuel per Available Lower Berth Day (ALBD) declining compared to 2023. This reflects both cost-saving opportunities and the easing of inflationary pressures.
The company has been actively expanding its operations and offerings. A new Fleet Operations Center in Hamburg, Germany, was opened to support European brands. Moreover, Carnival announced the expansion of Half Moon Cay and introduced the Pearl Cove Beach Club at Celebration Key, an exclusive retreat set to debut in July 2025. This premium experience includes supervillas, cabanas, and shore excursions, with nearly half of 2025 already booked and less inventory remaining for sale than in FY23.
Carnival's digital marketing efforts have paid off, with significant increases in web visits and search traffic. The company has attracted a growing number of new-to-cruise guests, alongside an increase in repeat customers.
The third quarter saw at least a 6% improvement in per diems over the previous year, fueled by higher ticket prices and onboard spending. Carnival's unit operating income rose by 26%, marking the highest level achieved in fifteen years. Total customer deposits hit a record $6.8 billion, exceeding the prior third-quarter record of $6.4 billion in 2023.
With strong demand, Carnival has raised its full-year yield guidance for the third time this year. The introduction of the next-generation ship, Sun Princess, by Princess Cruises, is part of the company's strategy to continue a robust cadence of new ship introductions in the coming years.
Tigress Financial Partners anticipates ongoing gains in revenue and cash flow, which will contribute to profitability, debt reduction, operating efficiencies, and increased shareholder value. The firm's 12-month target price reflects a potential return of over 55% from current levels.
In other recent news, Carnival Corporation has reported record-breaking third-quarter earnings, with revenues reaching nearly $8 billion and net income surging over 60%. Analysts from Deutsche Bank, Stifel, Mizuho Securities, William Blair, Barclays, and Goldman Sachs have all provided positive outlooks on Carnival.
Deutsche Bank has maintained a Hold rating on Carnival, citing optimistic booking trends for the upcoming years, while Stifel reaffirmed its Buy rating, emphasizing a strong earnings beat and favorable future outlook. Mizuho Securities raised its price target to $26, citing improved margins and operational efficiency.
William Blair maintained an Outperform rating, and Barclays and Goldman Sachs both raised their price targets for Carnival, highlighting the company's strong quarterly performance and promising future outlook. These recent developments underscore Carnival Corporation's strong financial performance and promising future outlook.
InvestingPro Insights
Carnival Corporation's strong performance, as highlighted in the article, is further supported by recent InvestingPro data and tips. The company's market capitalization stands at $23.32 billion, reflecting its significant presence in the cruise industry. An InvestingPro Tip notes that Carnival is a "Prominent player in the Hotels, Restaurants & Leisure industry," aligning with the article's emphasis on the company's market leadership.
The article's focus on Carnival's record quarterly results and robust demand is reinforced by InvestingPro data showing a revenue growth of 22.18% over the last twelve months. This growth trend is expected to continue, as another InvestingPro Tip indicates that "Net income is expected to grow this year."
Carnival's improved profitability, mentioned in the article, is reflected in its P/E ratio of 13.16 and an adjusted P/E ratio of 14.02 for the last twelve months. The company's strong financial performance is further evidenced by its EBITDA growth of 83.52% over the same period.
The positive outlook from Tigress Financial Partners is echoed in InvestingPro Tips, which reveal that "11 analysts have revised their earnings upwards for the upcoming period" and "Analysts predict the company will be profitable this year." This optimism is also reflected in the stock's performance, with InvestingPro data showing a 35.9% price total return over the past year.
For investors seeking more comprehensive insights, InvestingPro offers additional tips and metrics beyond those mentioned here. The platform currently lists 8 more tips for Carnival Corporation, providing a deeper analysis of the company's financial health and market position.
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