Pina Colada Anyone?! $CCL Continues to Soar After Earnings Beat...

Pina Colada anyone?!

While the tech sector has been busy soaking up all the attention, Carnival Cruises (NYSE:CCL) has been quietly steering its ship towards record revenues and flashy operating income. And with the company's recent Q2 earnings release…

It’s clear Carnival didn’t just meet expectations, it sailed right past them.

(Source: Travel Pulse)

The company reported a $170 million bottom-line outperformance, driven by a 11% increase in stock price. Revenue and operating income also hit all-time highs, while future bookings are through the roof. So it’s obvious people are ready to swap their sweatpants for swimsuits while putting that beer belly on full display. 

(Source: Giphy) 

But it’s not just the numbers that’s got Wall Street all jacked up on Mountain Dew. Carnival has been making some serious moves lately in the strategy game as they recently announced plans to consolidate P&O Cruises Australia into Carnival Cruise Line - streamlining operations and enhancing returns. 

(Source: USA Today) 

Plus, they’re developing a new destination called Celebration Key, set to launch in 2025. Which means they aren’t just focused on offering more itineraries that result in massive hangovers, but they’re focused on creating unique experiences that keep customers coming back.

So of course, it’s understandable why Wall Street analysts are all aboard the Carnival hype train - .(I mean they have to justify their overinflated salaries somehow right?). 

(Source: Pinterest) 

Which is why Macquarie recently joined the bandwagon and raised their price target to $25, up from $24, citing strong demand and an extended booking curve. 

(Source: Investing.com) 

But even with this recent unexpected rally, analysts still see room for Carnival to run. Wells Fargo boosted their price target to $23, projecting a 32.9% rally. Compared to competitors like Royal Caribbean (NYSE: RCL) and Norwegian Cruise Line Holdings (NYSE: NCLH), Carnival is leading the pack with a potential EPS growth of 39.6% over the next 12 months. Noice! 

(Source: Giphy)

Big institutional investors are also taking notice. T. Rowe Price Associates increased their stake in Carnival by 1.5% last quarter, bringing their total investment to $22.3 million. 

Keep in mind, when the big dogs start pouring money into a stock, you know it’s worth a second look. Think: When everyone started wearing skinny jeans, and you wondered if you should too. 

So what’s the takeaway here? Well in addition to literally beating the street with its record numbers…

(Source: CNBC) 

It’s obvious where Carnival’s focus lies: Generating free cash flow and paying down debt. And with their newfound strategic initiatives, like the development of Celebration Key and brand consolidation, designed to drive revenue and improve operational efficiency - it sounds pretty promising for a company that turns every cocktail hour into a slurred karaoke showdown. 

But again, the numbers don’t lie and Carnival’s on an endless summer hot streak. So whether you want to add this stock to your portfolio, YOLO the last $20 you found in your pocket, or just book your next kid free vacation…

Carnival Cruises is definitely worth your attention. 

Stocks.News does not hold positions in any of the companies mentioned.