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Carnival (CCL) Gears Up for Q3 Earnings: What's in the Cards?

Carnival Corporation CCL is scheduled to report its third-quarter fiscal 2022 results on Sep 30. In the last reported quarter, the company delivered a negative earnings surprise of 43.9%.

Q3 Estimates

The Zacks Consensus Estimate for the fiscal third-quarter bottom line is pegged at a loss of 12 cents per share compared with a loss of $1.75 reported in the year-ago quarter.

The consensus mark for revenues stands at $4.95 billion. In the prior-year quarter, the company reported revenues of $546 million.

Factors to Note

Carnival’s fiscal third-quarter performance is likely to have benefited from the improvement in bookings and a return to full operation. The company stated that more than 90% of its capacity is back in guest cruise operations for third-quarter fiscal 2022.

During the fiscal second quarter, the company raised its booking position for the second half of 2022. The company stated that cumulative advanced bookings for the first half of 2023 are at the higher end of historical ranges and increased prices compared with the 2019 levels.

The company is also likely to have benefited from fleet expansion efforts. In the first quarter of fiscal 2022, the company announced the addition of Costa Toscana, AIDAcosma and Discovery Princess to its fleet of efficient ships. The company stated that the addition of the new ships, coupled with the removal of less efficient ships, is likely to pave the path for a 4% reduction in ship level unit cost in the upcoming periods, thereby enhancing the top and bottom lines.

However, high costs might have weighed on the to-be-reported quarter’s performance. The company’s operations are likely to have been impacted by the uncertainty stemming from the Russia-Ukraine war. Geopolitical developments have also pushed fuel curves higher.

Due to the war, management has decided to withdraw all activity in Russia (which represents 4.6% of capacity for the remainder of the year). The company anticipates the close-end nature of the deployment change and its inability to find alternatives for the itineraries to disrupt booking patterns for some time.

Carnival Corporation Price and EPS Surprise

Carnival Corporation price-eps-surprise | Carnival Corporation Quote

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Carnival this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Carnival has an Earnings ESP of -148.56%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company has a Zacks Rank #3.

Stocks Poised to Beat Earnings

Hilton Worldwide Holdings Inc. HLT has an Earnings ESP of +0.65% and a Zacks Rank #3.

Shares of Hilton have declined 14.7% in the past year. HLT’s earnings beat the consensus mark thrice in the trailing four quarters and missed once, the average surprise being 10%.

Live Nation Entertainment, Inc. LYV has an Earnings ESP of +14.16% and a Zacks Rank #3.

Shares of Live Nation have declined 19.6% in the past year. LYV’s earnings beat the consensus mark thrice in the trailing four quarters and missed once, the average surprise being 70.7%.

Marriott International, Inc. MAR has an Earnings ESP of +0.60% and a Zacks Rank #3.

Shares of Marriott have declined 10.9% in the past year. MAR’s earnings topped the consensus mark in each of the trailing four quarters, the average surprise being 18.6%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.

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Carnival Corporation (CCL): Free Stock Analysis Report
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Hilton Worldwide Holdings Inc. (HLT): Free Stock Analysis Report
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