Carnival (CCL): Evaluating Whether Recent Share Price Momentum Still Leaves the Stock Undervalued

Carnival Corporation & (CCL) has quietly outperformed the broader cruise space over the past week, even as the stock still sits below its recent peak. That mix of momentum and lingering skepticism is where today’s opportunity starts.

See our latest analysis for Carnival Corporation &.

Zooming out, Carnival Corporation &’s 7 day share price return of 6.76 percent and year to date share price return of 10.44 percent come on top of a powerful 3 year total shareholder return of 226.86 percent. This suggests momentum is rebuilding after this year’s pullback.

If you are comparing Carnival’s rebound with what else is working in travel and leisure, it can be a good time to broaden your search and explore fast growing stocks with high insider ownership

With earnings recovering, modest growth returning, and the share price still trading at a discount to analyst targets, the key question is whether Carnival remains undervalued or if the market has already priced in the next leg of growth.

Most Popular Narrative: 22.8% Undervalued

With Carnival Corporation & last closing at $27.62 against a narrative fair value of $35.76, the valuation case hinges on durable growth in earnings power.

The analysts have a consensus price target of $33.091 for Carnival Corporation & based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $43.0, and the most bearish reporting a price target of just $24.0.

Read the complete narrative.

Want to see why moderate revenue growth, rising margins and a lower future earnings multiple still point to upside? The full narrative lays out the math.

Result: Fair Value of $35.76 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, geopolitical instability and Carnival’s substantial debt load could pressure bookings, margins, and cash flow, which would challenge the optimistic growth and valuation narrative.

Find out about the key risks to this Carnival Corporation & narrative.

Build Your Own Carnival Corporation & Narrative

If you see things differently or want to dig into the numbers yourself, you can build a customised Carnival thesis in just a few minutes: Do it your way

A great starting point for your Carnival Corporation & research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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