Does Carnival Corporation & plc (CCL) offer a good opportunity for investors?

Carnival Corporation & plc (NYSE: CCL) stock jumped 4.12% on Friday to $8.85 against a previous-day closing price of $8.50. With 65.9 million shares changed hands, the volume of the stock remained heavier than its average volume of 51.48 million shares. During the session, the Travel Services company that operates in wider Consumer Cyclical sector, reached to the highest price of $8.89 whereas the lowest price it dropped to was $8.47. The 52-week range on CCL shows that it touched its highest point at $27.39 and its lowest point at $8.10 during that stretch. It currently has a 1-year price target of $14.41. Beta for the stock currently stands at 2.17.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CCL was down-trending over the past week, with a drop of -20.20%, but this was down by -16.11% over a month. Three-month performance dropped to -49.43% while six-month performance fell -56.19%. The stock lost -61.18% in the past year, while it has lost -56.01% so far this year. A look at the trailing 12-month EPS for CCL yields -8.09 with Next year EPS estimates of 0.95. For the next quarter, that number is -0.13. This implies an EPS growth rate of 35.90% for this year and 179.60% for next year. EPS is expected to grow by 9.95% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of -33.70%.

Float and Shares Shorts:

At present, 1.14 billion CCL shares are outstanding with a float of 906.65 million shares on hand for trading. On Apr 28, 2022, short shares totaled 96.24 million, which was 8.19% higher than short shares on Mar 30, 2022. In addition to Mr. Micky Meir Arison as the firm’s Exec. Chairman, Mr. Arnold W. Donald serves as its CEO, Chief Climate Officer, Pres & Director.

Institutional Ownership:

Through their ownership of 53.82% of CCL’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 8.58% of CCL, in contrast to 23.57% held by mutual funds. Shares owned by individuals account for 21.13%. As the largest shareholder in CCL with 8.78% of the stake, The Vanguard Group, Inc. holds 86,868,103 shares worth 86,868,103. A second-largest stockholder of CCL, BlackRock Fund Advisors, holds 36,672,694 shares, controlling over 3.71% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in CCL, holding 31,086,605 shares or 3.14% stake. With a 2.50% stake in CCL, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 24,765,487 shares are owned by the mutual fund manager. The Vanguard Mid Cap Index Fund, which owns about 1.96% of CCL stock, is the second-largest Mutual Fund holder. It holds 19,359,811 shares valued at 167.46 million. Vanguard 500 Index Fund holds 1.81% of the stake in CCL, owning 17,945,332 shares worth 155.23 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CCL since 24 analysts follow the stock currently. There are 6 analysts who recommend BUY ratings, while 4 suggest SELL ratings. Of the remaining analysts, 11 believe that the stock is worth HOLDING, 2 give it an OVERWEIGHT rating, and 1 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CCL analysts setting a high price target of $29.00 and a low target of $7.00, the average target price over the next 12 months is $12.67. Based on these targets, CCL could surge 227.68% to reach the target high and fall by -20.9% to reach the target low. Reaching the average price target will result in a growth of 43.16% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CCL will report FY 2022 earnings on 12/21/2022. Analysts have provided yearly estimates in a range of -$2.08 being high and -$4.29 being low. For CCL, this leads to a yearly average estimate of -$3.64. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Carnival Corporation & plc surprised analysts by -$0.43 when it reported -$1.64 EPS against a consensus estimate of -$1.21. The surprise factor in the prior quarter was -$0.38. Based on analyst estimates, the high estimate for the next quarter is $1.26 and the low estimate is -$0.59. The average estimate for the next quarter is thus -$0.05.

Summary of Insider Activity:

Insiders traded CCL stock several times over the past three months with 8 Buys and 0 Sells. In these transactions, 300,000 shares were bought while 0 shares were sold. The number of buy transactions has increased to 46 while that of sell transactions has risen to 30 over the past year. The total number of shares bought during that period was 651,762 while 334,684 shares were sold.

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