Analyst Views Carnival's Stock Reaction And Long-Term Guide Introduction As Positive Steps For Future Growth

Carnival Corp CCL reported upbeat second-quarter FY23 results on Monday.

Analysts weighed in on the results. Below are some highlights, along with current ratings and price targets.

BofA Securities – Buy, $20 Price Target

The analyst Andrew G. Didora said CCL shares were weak (-7.6%) on its 2Q earnings print as investors took profits after the shares returned over 40% in June.

2023 EBITDA was nicely raised to $4.100-4.250 billion versus prior view of $3.900-4.100 billion, and long-term targets were ahead of expectations.

Also, CCL announced its SEA Change Program, setting performance targets through 2026 implying 2026 EBITDA of $6.7 billion (versus $6.4 billion Street view)

CCL's pricing commentary was solid with full year net pricing raised 250 basis points to +5.5-6.5%, and 90% of 2023 revenues are now on the books.

Truist Securities – Sell, $11 Price Target

Analyst C. Patrick Scholes said 2Q earnings results came in better than expected. Unlike at 1Q when guide disappointed, CCL is organically raising 2H expectations.

While 3Q guide is roughly in-line with consensus, implications are that 4Q implied guide is well ahead of the Street.

Susquehanna – Positive, $17 (Up From $11) Price Target

Analyst Christopher N. Stathoulopoulos said yesterday's stock reaction is not surprising given CCL's full ~70% run-up since mid-March.

While the analyst expected a raise to FY23 guidance, the introduction of a muti-year guide came earlier than expected and, was necessary to support fundamental momentum going forward, particularly as peer Royal Caribbean Cruises Ltd. RCL introduced their long-term guide approximately eight months ago.

Price Action: CCL shares traded higher by 8.2% at $15.80 on the last check Tuesday.