Founded in 1972, Carnival Corporation (CCL:US) offers leisure travel services, managing a fleet of almost 90 ships, & visiting around 700 ports. With a current Market Cap of $16.5 billion, Carnival is listed on the New York Stock Exchange under the symbol CCL. An interesting fact that the company boasts is that it is the only company ranking in both: the S&P 500 and the FTSE 250 indexes.
Back at the end of June 2023, Carnival Corp. shares experienced a 9.7% rise in a single day, adding to the stock's already exceptional performance in June. Adding to this, a company insider at Carnival recently bought CCL shares. This could spark another bullish wave for the cruise liner which has already been riding high.
Director’s Million Dollar Purchase
Company insiders can access non-public information about the company's performance, prospects, or other factors that could affect its stock price.
On October 10, Independent Director, Randall John Weisenburger, bought 350,000 CCL shares at a price of $12.985 per share. This amounted to $4.55 million worth in total.
It is also worth noting that this is the first insider buying Carnival stock has seen in 2023, following sales from many insiders.
Company Holdings & Stock Performance
A dive into Carnival’s holdings states that Insiders own a significant part of the company's stock, accounting for 47.75%. Additionally, Vanguard holds around 101,311,084 shares - the most shares of CCL - representing 9.05% ownership.
CCL stock declined on October 12, Thursday. In a dismal trading day for the whole market, CCL still outperformed, closing at $12.60.
Director Weisenburger’s trade comes at an already bullish time for CCL.
A day after the purchase, Carnival Corp and Royal Caribbean Group announced their collaboration with the Grand Bahama Shipyard Ltd to reclaim the latter’s title of the top global cruise ship repair facility. This $600 million transformation is set to have a substantial economic impact on Grand Bahama for the next 25 years.
Although raging fuel prices have caused some investors to pull back, there are still other factors to consider. Carnival’s fiscal Q3 results showed a revenue increase of 60% to a record $6.9 billion, driven by higher occupancy rates. This resulted in the company's first profitable quarter since the post-Covid era. The adjusted EPS of $0.86 in Q3 indicates profitability, even in an inflationary and higher interest rate environment. Furthermore, cruise bookings are 20% above 2019 levels, and advanced bookings for 2024 are at historic highs.
The overall sentiment is optimistic despite concerns about geopolitical events affecting oil prices. Wall Street views CCL as undervalued, with 7 out of 10 issuing 'buy' ratings. This suggests limited downside and substantial upside potential.
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