Carnival Corporation & plc (NYSE:CCL), a leading cruise operator, is set to release its fourth-quarter earnings tomorrow before the market opens. This article provides a preview of what investors can expect from the report.
Last quarter, Carnival exceeded analysts’ revenue projections by 1%, posting $7.90 billion in revenue, a year-over-year increase of 15.2%. The company reported 28.1 million passenger cruise days, marking an 8.9% rise compared to the same period last year. While the quarter saw a positive surprise on adjusted operating income, EBITDA guidance for the upcoming quarter fell short of analyst expectations.
For the current quarter, analysts predict a more moderate revenue growth of 10% year-over-year, reaching $5.93 billion. This represents a deceleration compared to the 40.6% surge witnessed in the same quarter of the previous year. Adjusted earnings per share are anticipated to be $0.07.
Analysts’ consensus estimates have remained largely unchanged over the past month, indicating a stable outlook for Carnival heading into the earnings announcement. Historically, Carnival has consistently surpassed revenue expectations, exceeding projections by an average of 1.3% over the past two years, with only one miss.
As the first major cruise line to report earnings this season, Carnival’s results will be closely watched for insights into the broader consumer discretionary sector. Despite the upcoming earnings release, investor sentiment towards the sector has been relatively neutral, with share prices remaining flat over the past month. Carnival’s stock, however, has experienced a slight decline of 1.4% during the same period. The average analyst price target for Carnival stands at $27.97, presenting a potential upside compared to its current share price of $24.72.
In conclusion, Carnival’s Q4 earnings report will provide crucial insights into the company’s financial performance and offer a glimpse into the health of the cruise industry and the broader consumer discretionary sector. While revenue growth is expected to moderate, the company’s track record of exceeding expectations and the potential upside in its stock price make it a compelling case for investor attention. The market will be closely analyzing the results and management’s commentary to gauge the company’s future prospects.
