Stifel raises Carnival stock price target to $31 from $30

On Monday, Stifel analysts adjusted their outlook on Carnival Corporation (NYSE:CCL) shares, increasing the price target to $31.00 from the previous $30.00, while reiterating a Buy rating on the stock. According to InvestingPro data, CCL currently trades at $20.94, with analyst targets ranging from $14 to $34, suggesting significant potential upside. This change reflects Stifel’s ongoing confidence in the cruise operator despite a mixed environment for the travel and leisure industry.

The analyst at Stifel acknowledged the current uncertainty that investors face when it comes to cruise stocks. The conflicting signals from the market include positive booking and onboard revenue reports from cruise companies, contrasted with signs of softening leisure demand reported by other consumer-facing businesses. InvestingPro data shows CCL has achieved impressive revenue growth of 12.66% over the last twelve months, with a healthy gross profit margin of 54%.

The key focus for Stifel remains on bookings for cruise lines. Despite occasional dips in demand, the firm does not see substantial evidence to suggest a collapse in cruise demand that would force operators to significantly cut prices to boost demand. This perspective comes amidst a broader discussion about the resilience of cruise fundamentals compared to other consumer sectors.

Carnival Corporation’s shares are currently trading at roughly a 30% discount to their historical average trading multiple. With a P/E ratio of 11.95 and strong financial health metrics according to InvestingPro, which rates the company’s overall financial health as "GREAT", Stifel interprets this as an indication that the market has already factored in potential negative outcomes. Consequently, the firm views the risk-reward balance at the current levels as particularly attractive for investors. InvestingPro subscribers can access 6 additional key insights about CCL’s financial performance and market position.

The Stifel analyst concluded that, given the current market conditions and the performance of Carnival Corporation’s bookings, the company’s stock presents a compelling opportunity at its current valuation. This stance by Stifel suggests confidence in the cruise operator’s ability to navigate the uncertain market environment.

In other recent news, Carnival Corporation has reported a strong performance for the first quarter of 2025, with earnings per share of $0.13, surpassing the forecast of $0.02. The company’s revenue reached $5.81 billion, exceeding expectations of $5.75 billion, and net income surpassed guidance by $170 million. This robust performance has led Carnival to raise its full-year guidance by $185 million. Mizuho (NYSE:MFG) Securities increased its price target for Carnival to $33.00 from $32.00, maintaining an Outperform rating, citing the company’s impressive first-quarter results and positive outlook for the year. Stifel also raised its price target to $31.00 from $30.00, keeping a Buy rating, and noted Carnival’s stock trading at a discount compared to its historical average. Meanwhile, Bernstein maintained a Market Perform rating and a $26.00 price target, acknowledging Carnival’s significant EBITDA outperformance but expressing caution due to execution risks and slower growth compared to peers. These developments highlight Carnival’s resilience and strong demand in the cruise industry despite a challenging environment.

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