Carnival (CCL) Falls More Steeply Than Broader Market: What Investors Need to Know

Carnival (CCL) closed the most recent trading day at $27.16, moving -3.03% from the previous trading session. This move lagged the S&P 500's daily loss of 0.57%. On the other hand, the Dow registered a loss of 1.61%, and the technology-centric Nasdaq decreased by 0.26%.

Shares of the cruise operator have depreciated by 12.71% over the course of the past month, underperforming the Consumer Discretionary sector's gain of 2.06%, and the S&P 500's loss of 0.15%.

The investment community will be paying close attention to the earnings performance of Carnival in its upcoming release. The company's earnings per share (EPS) are projected to be $0.18, reflecting a 38.46% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $6.1 billion, indicating a 5.01% upward movement from the same quarter last year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $2.54 per share and a revenue of $27.85 billion, indicating changes of +12.89% and +4.6%, respectively, from the former year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Carnival. Such recent modifications usually signify the changing landscape of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection remained stagnant. At present, Carnival boasts a Zacks Rank of #3 (Hold).

In terms of valuation, Carnival is currently trading at a Forward P/E ratio of 11.02. This valuation marks a discount compared to its industry average Forward P/E of 16.54.

Also, we should mention that CCL has a PEG ratio of 1.02. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Leisure and Recreation Services industry held an average PEG ratio of 1.39.

The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. At present, this industry carries a Zacks Industry Rank of 176, placing it within the bottom 29% of over 250 industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow CCL in the coming trading sessions, be sure to utilize Zacks.com.