Investors in Carnival Corp (CCL, Financial) have witnessed a notable fluctuation in the company's stock price recently. With a current market capitalization of $25.04 billion, the stock is trading at $19.17. Over the past week, the stock has experienced a slight decline of 1.09%. However, looking at a broader timeframe, Carnival Corp's shares have surged by 23.34% over the past three months. This significant gain contrasts with the company's GF Value of $32.7, which has slightly increased from the past GF Value of $32.61. Despite the recent stock price rally, the GF Valuation still suggests caution, labeling the stock as a Possible Value Trap, Think Twice, a sentiment that has remained unchanged from the previous valuation.
Overview of Carnival Corp
Carnival Corp, a leading entity in the Travel & Leisure industry, operates the largest global cruise line. With a diverse brand portfolio that includes Carnival Cruise Lines, Holland America, and Princess Cruises, among others, Carnival has a significant presence in various regions. The company's expansive operations include 90 ships and a reach that attracted approximately 13 million guests in 2019. After the challenges posed by COVID-19, Carnival is on track to regain its pre-pandemic guest levels in 2023. The company's broad offering, which extends to land tours in Alaska and the Canadian Yukon, positions it as a comprehensive provider in the leisure travel sector.
Assessing Carnival's Profitability
When it comes to profitability, Carnival Corp holds a Profitability Rank of 6/10, indicating a moderate level of profitability within the industry. The company's operating margin stands at 2.19%, which is more favorable than 33.94% of 819 companies in the same sector. However, Carnival's Return on Equity (ROE) is deeply negative at -23.58%, although it still outperforms 11.88% of its peers. The Return on Assets (ROA) and Return on Invested Capital (ROIC) are -3.16% and 0.82% respectively, placing Carnival better than 22.82% and 37.58% of companies in the industry. Over the past decade, Carnival has managed to maintain profitability for 7 years, which is better than 61.2% of its competitors.
Growth Trajectory of Carnival Corp
The Growth Rank for Carnival Corp is currently at a low 1/10, reflecting significant challenges in the company's growth metrics. The 3-Year Revenue Growth Rate per Share has plummeted by 30.00%, and the 5-Year Revenue Growth Rate per Share has decreased even further to -32.80%. These figures indicate that Carnival has struggled to maintain revenue growth, performing better than only 10.73% and 7.56% of companies in the industry over these periods, respectively.
Notable Shareholders in Carnival Corp
Among the major holders of Carnival Corp's stock, Jim Simons (Trades, Portfolio) leads with 12,810,623 shares, representing a 0.98% share percentage. Following him is PRIMECAP Management (Trades, Portfolio), holding 6,381,478 shares, which accounts for 0.49% of the company's shares. Murray Stahl (Trades, Portfolio) also has a significant stake with 1,160,590 shares, equating to a 0.09% share percentage. These prominent investors' positions reflect their confidence in the company's potential despite the current challenges.
Competitive Landscape
Carnival Corp operates in a competitive industry, with key players such as Expedia Group Inc (EXPE, Financial) with a market cap of $20.98 billion, Trip.com Group Ltd (TCOM, Financial) valued at $22.02 billion, and Royal Caribbean Group (RCL, Financial) leading with a market cap of $32.31 billion. These competitors are closely matched in terms of market capitalization, indicating a highly competitive environment for Carnival Corp.
Conclusion: Carnival Corp's Market Position and Future Outlook
In summary, Carnival Corp's stock performance has been a mixed bag, with a recent uptick in the past three months but a cautionary valuation suggesting investors should think twice. The company's profitability metrics are moderate, with some areas outperforming a significant portion of the industry, while growth remains a concern with negative trends in revenue. The positions held by major investors and the competitive market caps of its rivals suggest that Carnival Corp operates in a dynamic and challenging industry. As the travel and leisure sector continues to recover from the pandemic, Carnival's ability to navigate these waters will be critical to its future success.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
