Carnival Share Discussion Threads

[wad collector] 25/9/2013 12:45

Ah well...have to stay long with these for longer.

[miata] 25/9/2013 12:17

Morgan Stanley

Yield outlook disappointing. CCL guided to 1H14 yields -3% to -4%, and we now assume F14 yields +1.5% (-2.5% 1H, +5% 2H) vs. +3.5% prior (1% on yield
~$0.17 to EPS). CCL would not commit to guiding to positive yields for F14. Our yield 'stack' and regional/ brand analysis suggest we are being a little generous.

CCL's yields are now 11% below 2008, a ~$2 potential EPS recovery. However, we question whether this recovery will be as smooth as its valuation implies given
the track record of underperformance and still fairly high industry capacity growth.

Cost outlook disappointing. CCL needs to reinvest in its physical product, distribution and marketing; it guides to another year of c4% net unit cost growth for F14 (1% on cost ~$0.10 to EPS), with MSe at +3%. Essentially,
modest yield growth will not quite offset cost pressures, so, net of FX and fuel moves, EPS seems likely to be flattish yoy in F14. Note, 2015 will see an ECA fuel regulation hit of up to $0.35 (we assume half this).

Valuation very demanding. CCL's dual stocks trade on P/Es of 22-23x F14e and 17-18x F15e, with FCF yields of 1% and 4%. The shares have held up well in the face
of significant earnings downgrades over the last few years, reflecting investors' increasing willingness to look through to a more normal yield environment. But "normality" keeps being pushed out, and even on F15 the shares look expensive to us. If wrong on yield growth and cost control, in our bull case we see +3% yield and $2.06 EPS in 2014e, implying 17x P/E.

[miata] 25/9/2013 12:16

Merrill
3Q13 results were less about 3Q13 or FY13E which were broadly in line with prior
guidance, but, more about the outlook / guidance for FY14. In this note we have cut our 2014E EPS by c.30% to US$1.49 from US$2.23, vs our FY13E EPS of US$1.54
and compared with current consensus of US$2.17. We now forecast 0.5% net yield
growth in 2014 (from +3%) and unit cost growth of 3.5% (from -1%).

While visibility still remains low for FY14 (c.50% for 1H14 & c.20% 2H14), initial indications were much weaker than expected on both net yield and unit costs. Net yields are expected to be down c.3% in 1H14 (similar to 2H13) vs. our previous expectation for around 0% and we now estimate 2H yields +4% vs. +5 to 6% previously. FY14 unit cost guidance excluding fuel is also disappointing with growth expected to be at a similar level to 2013 (c.3.5% vs. our previous forecast of -1%). We had expected some of the additional costs incurred in 2013 as a result of the significant disruption to reverse in 2014; this is not expected to occur. With every 1%pt change in net yield impacting group EPS by 16 cents 7% and every 1%pt change in units costs impacting EPS by 8 cents 3.5% then the twin impact of weaker FY14 expectations for both net yield and unit costs is material.

Notwithstanding ROIC being c.5%, well below cost of capital, we do believe book
value of US$31 or £19.40 is an important support to the shares.

While our belief in this stock has been shaken again, we do still believe this asset under improved stewardship has both the market position and scale to derive ROIC in excess of WACC and much improved margins. In 2008 (pre-crisis) margins were 18% vs. 9% currently and ROIC was 11% vs. 5% currently. We continue to assume that CCL
can return to these KPI levels by 2018E but, 2014 represents a delay. Our PO
reduces from £28/US$42.8 to £24/US$38.5 which reflects higher execution risk.

[aspers] 25/9/2013 11:58

Way oversold......these brokers talk through their backsides......still given me a great chance to get back aboard for the cruise of a lifetime ;-)

[miata] 25/9/2013 10:27

Numis and Morgan Stanley downgrade. (minimum now 2088p)

[el chupacabra] 24/9/2013 21:32

lol @ the Analysts

[miata] 24/9/2013 21:05

Carnival said it expects adjusted per-share results for the current quarter to be in the range of a loss of 3 cents to a profit of 3 cents. Analysts on average were expecting earnings of 9 cents per share.

Carnival also said it expects fourth-quarter net revenue yields, which blend ticket sales and money spent onboard, to fall 3 to 4 percent on a constant currency basis.

Morningstar analyst Jamie Katz called the outlook disappointing and said investors were expecting the company to lap comparable year-over-year numbers after two really weak booking seasons. "What the commentary indicates to us is that that's not the case," the analyst said. Katz said the company may be losing share to competitors such as Royal Caribbean Cruises and Norwegian Cruise Line Holdings, or customers may be looking for better deals.

[miata] 24/9/2013 15:29

Carnival shares have lost 5.5% (132p) today on results. (Minimum 2219).

[miata] 24/9/2013 15:17

3Q Non-GAAP (diluted) earnings per share of $1.38, compared to $1.53 for the prior year.

Cumulative advance bookings for the remainder of 2013 and the first half of 2014 are behind the prior year at prices in line with prior year levels

Carnival Corp said it will take up to three years for its Costa brand to recover its reputation and profitability after its Concordia ship sank off the Italian coast last year. Arison said Costa remained the number one cruise brand in Italy, France, South America, and China and would likely return to profit this year.

The company expects to see prices strengthen in 2013/14 after prices remained stable last year.

Its British P&O Cruises business on Tuesday said its newest cruise ship, the Britannia, would enter service in the first quarter of 2015, boosting its annual capacity by 24 percent. The new vessel will be able to carry over 3,600 passengers and will be 25,000 tons larger than P&O Cruises next largest ship. It will initially be used from Southampton in southern England to the Mediterranean, northern Europe and across the Atlantic.

[miata] 17/9/2013 10:44

A cruise company executive has said that the Concordia salvage operation cost 600 million euros (£503 million), but the figure will rise significantly.

[wad collector] 23/8/2013 09:02

I shall rush out to spend it.
Are we finally going to see £26 breached again ? Something rather promising about this mornings sharp rise.

[miata] 20/8/2013 08:33

XD 21/08/13.

[miata] 09/7/2013 08:48

Francesco Schettino trial starts today.

Four other crew members, including the ship's Indonesian helmsman, and a Costa manager have entered plea bargains with short prison sentences, which will be ruled on in a separate hearing on July 20.

Costa earlier admitted limited responsibility as Mr Schettino's employer and was ordered to pay 1.0 million euros in a controversial ruling that has excluded it from criminal proceedings.

[grahamburn] 25/6/2013 14:59

But not perhaps the subsequent announcement of Arison handing over his executive responsibilitiies.

[wad collector] 25/6/2013 14:33

Q2 results look a bit of a mixed message to me , but the market seems to like them ; up 5%.

[pyglet] 23/6/2013 14:22

No Headlines Are Good Headlines For This Stock

It has been a tough year for the cruise company Carnival Corporation (CCL), as news regarding electrical and fire problems aboard has led to fear among consumers, slashed guidance, and weak earnings during its most recent quarterly report. The company has had to deal with soft ticket pricing, higher-than expected trip cancellations, and higher sales/admin costs. With that said, expectations for the cruise company are at rock bottom levels, and for this fact, upside could be created.

Back in May, the stock lost 7% of its value as the company cut EPS guidance to $1.45-$1.65, compared to a consensus of $1.97, due to the issues noted above. However, as Seeking Alpha contributor Jeffrey Dow Jones notes, "this is an industry that periodically suffers from high profile setbacks," but as a secular industry, it always bounces back.

So, why am I so bullish on Carnival heading into earnings on Tuesday? First, the stock is cheap, underperforming the S&P 500 with a YTD loss of 10%, with a yield of 3%, and a forward P/E ratio that is below the consumer sector, thus I think investors might be attracted to the stock. Then, most importantly, is the silence surrounding the company. Lately, we've seen no negative headlines surrounding the company and with its busy season in full-swing, I view this as a sign of optimism. Yes, we already know that prices are lower than usual, but due to value pricing and new ship renovations, I wouldn't be shocked to see a sudden bullish update on volume - pushing the stock higher after earnings.

[miata] 22/5/2013 07:53

22 May Carnival PLC CCL Deutsche Bank Buy 2,267.00 2,267.00 2,780.00 2,640.00

22 May Carnival PLC CCL Morgan Stanley Equal weight 2,267.00 2,267.00 2,400.00 2,200.00

[bigman786] 21/5/2013 21:47

thanks graham

[grahamburn] 21/5/2013 20:46

bigman.

The ex-dividend date is ALWAYS a Wednesday (so Carnival goes ex-dividend on 22 May - tomorrow).

The record date is ALWAYS a Friday (so the record date is 24 May - Friday).

Well, almost always, there is the odd exception.

But Carnival is no different from most other shares.

So, if you don't hold the shares now, you won't get the dividend this time round.

[bigman786] 21/5/2013 20:37

aspers ... just reading RNS from 17th Apr stating 'recording date' for divi is 24th May and not 21st May?

[philanderer] 21/5/2013 17:37

On the watchlist.

[aspers] 21/5/2013 16:54

Oversold I hope......I have come aboard for the first time....ex div tommorrow 25cents so happy to stay for a longish cruise :-)

[miata] 21/5/2013 12:50

21 May Carnival PLC CCL Numis Add 2,194.50 2,410.00 2,750.00 2,750.00