It’s that time of year again – Carnival Corporation & plc (CCL) is gearing up to reveal its first-quarter fiscal 2024 results on March 27, 2024, as the dawn breaks on the trading day. In the last earnings outing, the company surprised the market with a whopping 41.7% earnings beat.
Estimates Afloat
Initial estimates are looking promising for the upcoming quarter, with the Zacks Consensus Estimate projecting a narrower loss per share of 17 cents, an improvement from 18 cents in the last 30 days. Contrastingly, in the corresponding quarter last year, CCL encountered a loss per share of 55 cents.
Navigating Through Price and EPS Surprises
Carnival Corporation price-eps-surprise | Carnival Corporation Quote
The consensus revenue target stands at $5.4 billion for this quarter, reflecting a robust 21.9% growth from the figures of the same period last year, which amounted to $4.43 billion.
Factors on the Horizon
Carnival is steering towards a revenue surge in the fiscal first quarter, propelled by enhancements in occupancy rates, booking trends, and an upbeat pricing environment. The high tide of demand boosted by innovative marketing strategies and escalated onboard expenditures through bundled promotions and pre-voyage sales are believed to have bolstered the company’s performance in the upcoming quarter.
The expected uptick in revenue streams from passenger ticket sales and onboard activities are anticipated to fuel the top-line growth. Projections point to a 13.1% year-over-year increase in passenger ticket revenues to reach $3.25 billion. Simultaneously, other onboard revenues are forecasted to climb 33.5% to $2.09 billion.
In terms of performance metrics, Carnival anticipates an adjusted EBITDA of roughly $0.8 billion for the first quarter, a significant boost from $0.38 billion reported in the same period last year. The adjusted net loss is expected to stand at around ($0.28) billion, showing an improvement from ($0.69) billion a year ago. The adjusted loss per share is estimated to hover around 22 cents.
Despite the favorable winds in sales, elevated costs may have ruffled the waters for the company’s profitability. Rising operating expenses, driven by increased occupancy rates, dry-dock costs, and seasonal advertising outlays, are poised to squeeze the margins. Carnival projects a 9.5% surge in adjusted cruise expenses per available lower berth day compared to 2023 levels. Overall, total operating costs for the fiscal first quarter are predicted to escalate by 10.9% to $3.67 billion.
Setting Sail with the Zacks Model
Our analytical compass is pointing north for Carnival this time. The harmonious blend of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) augurs well for an earnings beat.
Earnings ESP: The company boasts an Earnings ESP of +6.26%. To unearth hidden gems in advance of earnings announcements, check out our Earnings ESP Filter.
Zacks Rank: Carnival is currently carrying a Zacks Rank #2. For a comprehensive list of today’s top Zacks #1 Rank stocks, peruse this compilation.
Stocks in High Seas
Below the surface, we identify a few promising vessels in the vast ocean of stocks from the Consumer Discretionary sphere, primed to outshine earnings predictions.
PVH Corp. (PVH) is navigating with an Earnings ESP of +1.51% and holds a Zacks Rank #2.
PVH is headed for a 47.1% year-over-year uptick in earnings for the upcoming quarter. Notably, the brand has surpassed earnings estimates in each of the last four quarters with an average surprise of 18.9%.
Guess?, Inc. (GES) is another vessel, sailing with an Earnings ESP of +2,100.00% and a Zacks Rank #3.
Anticipated to book an 85.7% year-over-year growth in earnings, GES previously exceeded earnings projections in three out of the last four quarters, with an average surprise of 42.1%.
Boyd Gaming Corporation (BYD) is charting its course with an Earnings ESP of +1.07% and holds a Zacks Rank #3.
BYD’s earnings are anticipated to retreat by 8.2% year over year. Despite this, the company has a track record of outperforming the market’s earnings expectation in three of the last four quarters, with an average surprise of 6.3%.
For the latest earnings announcements, stay tuned to the Zacks Earnings Calendar.
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The musings and viewpoints expressed here belong to the author alone and may not exactly mirror those of Nasdaq, Inc.
