Bridgewater Associates and Carnival
Bridgewater Associates’ new positions in 3Q14 include American Express (AXP) and United Parcel Service (UPS). Positions sold include ConAgra Foods, Inc. (CAG) and Carnival Corp. (CCL). The fund increased its position in United Technologies Corp. (UTX), Analog Devices (ADI), and CA, Inc. (CA). It decreased its stake in Intel (INTC), Microsoft (MSFT), and Ventas, Inc. (VTR).
The hedge fund sold its position in Carnival. According to 13F filings for 3Q14, it accounts for 0.09% of the total portfolio.
Carnival started in Panama in 1972. It’s the largest cruise company in the world. The company operates 101 cruise ships. The ships travel to popular destinations in North America, Europe, Australia, and Asia. The ships are under ten brands. Globally, Carnival has a market share of ~47%. Carnival’s shares are listed on the NYSE as well as the London Stock Exchange
Carnival expanded its operations in numerous segments of the cruise industry—including contemporary, premium, and luxury cruise services. It acquired several brands. Carnival acquired premium operator Holland America Line in 1989, luxury brand Seabourn in 1992, Italian-based and Europe’s best cruise operator Costa Cruises in 1997, and premium and luxury operator Cunard Line in 1998.
Ebola outbreak affected Carnival
Carnival’s stock price was negatively impacted because of concerns about Ebola. It was impacted by 5.5% in September 2014. The Ebola outbreak hurt the travel industry’s stocks worldwide. Investors have been taking stock of the outbreak’s potential impact on tourism.
Carnival’s vessels cancelled stops and changed travel schedules in order to avoid the affected areas.
Carnival’s focus on web services
In October 2014, Carnival’s management stated that the firm is reacting to passengers’ growing use of social media on cruises. The company is updating its internet service onboard in order to provide as much as a ten-fold increase in internet connectivity and speed.
The WiFi@Sea network uses satellites and antennas. They’re placed on the land along cruise routes. Web services are now becoming increasingly important. Passengers want to be in constant contact with friends and family members while they’re on vacation.
The next part in this series will discuss Bridgewater Associates’ increased position in United Technologies.