News

Carnival Corporation & plc CCL reported impressive first-quarter fiscal 2024 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and the bottom line increased on a year-over-year basis. The upside was primarily backed by sustained demand strength and increased booking volumes at significantly higher prices. Following the results, the company’s shares moved up 4.9% in the pre-market trading session.

Earnings & Revenues

In the quarter under review, the company reported an adjusted loss per share of 14 cents, narrower than the Zacks Consensus Estimate of a loss of 18 cents. In the year-ago quarter, the company reported an adjusted loss of 55 cents.

Revenues in the quarter totaled $5.4 billion, beating the consensus mark by 0.02%. In the prior-year quarter, CCL reported revenues of $4.4 billion.

Carnival Corporation Price, Consensus and EPS Surprise

In the first quarter of fiscal 2024, passenger ticket revenues amounted to $3.6 billion, up from $2.9 billion in the prior-year quarter. Our estimate for passenger ticket revenues was $3.2 billion.

Onboard and other revenues increased to $1.8 billion, up from $1.6 billion reported in the year-ago quarter. Our estimate for Onboard and other revenues was $2.1 billion.

Q1 Financials

During the fiscal first quarter, the company reported a GAAP net loss of $214 million compared with a loss of $693 million reported in the prior-year quarter. Adjusted net loss in the quarter amounted to $180 million compared with $690 million reported in the year-ago quarter.

Balance Sheet

As of Feb 29, 2024, cash and cash equivalents were $2.2 billion compared with $2.4 billion as of Nov 30, 2023. Carnival ended the quarter with liquidity of $5.2 billion. Total debt (current and long-term) as of Feb 29, 2024, was $30.7 billion compared with $30.6 billion as of Nov 30, 2023.

Adjusted EBITDA, as of Feb 29, 2024, came in at $871 million compared with $382 million reported in the prior-year quarter.

Bookings Update

In the first fiscal quarter, the company announced strong bookings for its NAA and Europe segments, with booking levels notably higher compared to the previous year. Despite limited inventory, booking volumes reached unprecedented levels, courtesy of solid demand for future sailings (beyond 2025). The surge in demand resulted in increased prices and a longer booking window. The company reported a solid booked position for the remainder of the year, with pricing and occupancy significantly higher than 2023 levels.

Total customer deposits as of Feb 29 were $7 billion compared with $6.4 billion reported in the previous quarter. The amount was higher than $5.7 billion reported on Feb 28, 2023.

2024 Outlook

For the second quarter of fiscal 2024, the company expects adjusted EBITDA to be approximately $1.05 billion. The company expects fiscal second-quarter adjusted net income to be nearly ($35) million. The company expects a fiscal second-quarter adjusted loss per share to be 3 cents.

For fiscal 2024, the company anticipates adjusted EBITDA to be approximately $5.63 billion. Adjusted net income during the year is anticipated to be nearly $1.3 billion. In the fiscal 2024, the company expects adjusted earnings per share (EPS) to be 98 cents compared with the previous expectation of 93 cents.

Zacks Rank and Stocks to Consider

Currently, Carnival carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Zacks Consumer Discretionary sector are as follows:

Royal Caribbean Cruises Ltd. RCL sports a Zacks Rank #1 (Strong Buy). RCL has a trailing four-quarter earnings surprise of 26.4% on average. Shares of RCL have surged 126.3% in the past year. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for RCL’s 2024 sales and EPS indicates a rise of 14.7% and 47.9%, respectively, from the year-ago levels.

Trip.com Group Limited TCOM carries a Zacks Rank #2 (Buy). TCOM has a trailing four-quarter earnings surprise of 53.1%, on average. Shares of TCOM have gained 23.6% in the past year.

The Zacks Consensus Estimate for TCOM’s 2024 sales and EPS indicates a rise of 18.2% and 8%, respectively, from the year-ago levels.

Hyatt Hotels Corporation H carries a Zacks Rank #2. It has a trailing four-quarter earnings surprise of 17.8% on average. Shares of H have increased 52.9% in the past year.

The Zacks Consensus Estimate for H’s 2024 sales and EPS indicates a rise of 3.5% and 27%, respectively, from the year-ago levels.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.