CCL - Carnival: Consider This Potential Huge Compounder After Its Dip
2024-04-01 17:34:43 ET
Summary
- Carnival plans to expand capacity and increase onboard spending to enhance revenue.
- Holding a 39.5% market share, Carnival is ahead of Royal Caribbean and Norwegian Cruise Lines.
- Projected annual passenger growth of 6.34% through 2027 offers favorable conditions for Carnival's expansion.
- Using a DCF model, Carnival's fair price per share is $20.27, with a potential future price of $52.37 by 2029, indicating a significant upside.
- Despite debt and dilution risks, Carnival's resilience, backed by market presence and recovery prospects, supports a "strong buy" rating.
Thesis
My previous article about Carnival Corporation & plc ( CCL ) was released in Q4 2023 (a report that was released on December 21). In that article, I assigned Carnival a fair stock price target of $30.10 which at that time when the stock was trading at $19.20, represented a potential upside of 57%. Furthermore, I also assigned a future price of $75.90, which represented annual returns of 49.2% throughout 2029.
Since that previous article, Carnival's stock decreased by 13.6%. Nevertheless, since my second article on Carnival (released in Q2 2023 ) the stock has increased by 8.28%....
Carnival: Consider This Potential Huge Compounder After Its Dip