Carnival (CCL) Laps the Stock Market: Here's Why
Carnival (CCL) closed the most recent trading day at $23.16, moving +0.7% from the previous trading session. The stock's change was more than the S&P 500's daily gain of 0.4%. Meanwhile, the Dow gained 0.28%, and the Nasdaq, a tech-heavy index, added 0.39%.
The cruise operator's shares have seen an increase of 25.41% over the last month, surpassing the Consumer Discretionary sector's gain of 8.94% and the S&P 500's gain of 6.69%.
Investors will be eagerly watching for the performance of Carnival in its upcoming earnings disclosure. The company is predicted to post an EPS of $0.23, indicating a 109.09% growth compared to the equivalent quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.2 billion, up 7.19% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $1.85 per share and a revenue of $26.05 billion, representing changes of +30.28% and +4.12%, respectively, from the prior year.
It's also important for investors to be aware of any recent modifications to analyst estimates for Carnival. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming 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, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.38% higher. Carnival currently has a Zacks Rank of #3 (Hold).
In terms of valuation, Carnival is presently being traded at a Forward P/E ratio of 12.41. This expresses a discount compared to the average Forward P/E of 19.52 of its industry.
We can also see that CCL currently has a PEG ratio of 0.54. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As the market closed yesterday, the Leisure and Recreation Services industry was having an average PEG ratio of 1.5.
The Leisure and Recreation Services industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 89, which puts it in the top 37% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these 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.
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