uploads/2020/06/carnival-cruise-preliminary.jpg

Carnival’s Preliminary Q2 Results: Good and Bad

By

Updated

Carnival (NYSE:CCL) stock fell in today’s pre-market trading session. The stock fell around 8.2% in today’s trading session at 8:11 AM ET. The stock fell after the company released its preliminary results for the second quarter of fiscal 2020 before the market opened. Notably, the second quarter ended on May 31. Carnival missed the top and bottom-line estimates in the second quarter.

Q2 preliminary results

In the second quarter, Carnival expects to generate revenue of $0.7 billion—a decrease of 85.5% from the second quarter of fiscal 2019. The company missed analysts’ consensus revenue expectation of $0.8 billion. In the second quarter, Carnival expects an adjusted EPS of -$3.30 compared to $0.66 in the second quarter of fiscal 2019. The company missed analysts’ consensus estimate of -$1.52 per share.

According to a MarketWatch report, “As of May 31, about half the guests with bookings have requested cash refunds. For 2021, capacity available for sale are within historical ranges, but at prices that are down in the low to mid-single digit percentage ranges. Booking volumes for 2021 for the six weeks ended May 31 were meaningfully behind the prior year, but volumes for the six weeks ended May 31 saw an improvement over the prior six weeks.” The report also said, “Carnival said it plans to accelerate the removal of ships this year which were previously expected to be sold in coming years, with 6 ships expected to be disposed of in the next 90 days.”

Currently, Wall Street analysts expect a -51.5% and 45.6% growth in the company’s fiscal 2020 and 2021 sales, respectively. Analysts also expect a non-GAAP EPS of -$3.27 and -$0.42 in fiscal 2020 and 2021, respectively.

Analysts’ recommendations for Carnival stock

Wall Street analysts continue to recommend a “hold” rating for Carnival stock amid the coronavirus pandemic. Among the 20 analysts tracking Carnival, 13 recommend a “hold,” four recommend a “buy,” and three recommend a “sell.” The consensus target price of $18.19 per share implies a downside of 4.7% based on Carnival’s closing price of $19.09 on Wednesday.

On Thursday, Berenberg decreased its target price on Carnival stock from $14.50 to $10.

Stock returns

On Wednesday, Carnival stock fell 6.5% and closed at $19.09 with a market cap of $14 billion. Carnival’s stock price has fallen 7.3% in the trailing five-day period, while it has fallen 63.5% in the trailing 12-month period. The stock is trading 63.3% below its 52-week high of $51.94 on January 17, 2020. The stock was also trading 144.7% above its 52-week low of $7.80 on April 2, 2020. On a year-to-date basis, the stock has fallen by 62.4% as of Wednesday.

On Wednesday, Carnival stock was trading 4.8% above its 20-day moving average of $18.21. Meanwhile, the stock is trading 26.3% above its 50-day moving average of $15.11 and 13.3% below its 100-day moving average of $22.02.

At 8:48 AM ET today, Norwegian Cruise Line Holdings (NASDAQ:NCLH) and Royal Caribbean Cruises (NYSE:RCL) stocks fell 4.3% and 3.4%, respectively. Norwegian Cruise stock fell after the company announced that it extended the voluntary suspension of voyages through September. Read Before You Buy Norwegian Cruise Stock, Read This to learn more.

For more information about Carnival, read Why Is a J.P. Morgan Analyst Bullish about Carnival Stock? and Why Carnival Stock Might Be a Smart Long-Term Buy.

More From Market Realist