{"id":63234,"date":"2023-09-19T23:20:57","date_gmt":"2023-09-20T03:20:57","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/carnival-stock-things-arent-as-bad-as-i-thought-nyseccl\/"},"modified":"2023-09-19T23:21:03","modified_gmt":"2023-09-20T03:21:03","slug":"carnival-stock-things-arent-as-bad-as-i-thought-nyseccl","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=63234","title":{"rendered":"Carnival Stock: Things Aren’t As Bad As I Thought (NYSE:CCL)"},"content":{"rendered":"
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Thesis<\/h2>\n

In my previous article about Carnival Corporation (NYSE:CCL<\/span>), I estimated Carnival’s fair value to be $10.77 based on revenue projections for its lower berths up to 2025. However, I failed to realize that stock dilution wouldn’t have as catastrophic an impact as I initially thought. Subsequent to that article, the stock rapidly rose but later experienced a decline, resulting in a 3% loss since the publication of my initial piece on the stock.<\/span><\/p>\n

In this article, I will elucidate why I am giving Carnival a “strong buy” rating and establishing a stock price target of $22.07. In summary, this recommendation is based on the fact that, even with dilution considered, the stock still has the potential to yield a 22% annual return.<\/p>\n

Overview<\/h2>\n

Carnival, the world’s largest cruise company, has historically leveraged its size advantage during price wars. However, at the onset of the pandemic, this extensive fleet became a liability due to the substantial maintenance costs it entailed.<\/span><\/p>\n

In a previous article on Carnival, I issued a “sell” rating based on its long-term outlook. However, I failed to examine the potential price trajectory if Carnival were to significantly dilute its stocks. I have now conducted that analysis, and even in the event of such dilution, Carnival could still offer a respectable 22% annual return, though notably lower than the returns it could achieve without dilution.<\/p>\n

<\/span><\/p>\n\n\n\n\n\n\n<\/colgroup>\n\n\n\n\n\n\n\n\n
<\/td>\nRevenue<\/td>\nNet Income<\/td>\nPlus D&A<\/td>\nPlus Interest<\/td>\n<\/tr>\n
2023<\/td>\n21,340,000,000<\/td>\n2,134,000,000<\/td>\n5,011,336,220<\/td>\n6,500,461,220<\/td>\n<\/tr>\n
2024<\/td>\n21,976,068,855<\/td>\n2,197,606,886<\/td>\n5,160,706,177<\/td>\n6,716,841,802<\/td>\n<\/tr>\n
2025<\/td>\n22,329,424,038<\/td>\n2,232,942,404<\/td>\n5,243,685,635<\/td>\n6,869,847,363<\/td>\n<\/tr>\n
2026<\/td>\n22,976,977,335<\/td>\n2,297,697,734<\/td>\n5,395,752,519<\/td>\n7,095,091,524<\/td>\n<\/tr>\n
2027<\/td>\n23,643,309,678<\/td>\n2,364,330,968<\/td>\n5,552,229,342<\/td>\n7,328,038,603<\/td>\n<\/tr>\n
2028<\/td>\n24,328,965,658<\/td>\n2,432,896,566<\/td>\n5,713,243,992<\/td>\n7,568,964,670<\/td>\n<\/tr>\n
<\/td>\n <\/td>\n <\/td>\n <\/td>\n^Final EBITA^<\/td>\n<\/tr>\n<\/table>\n

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