CCL  Carnival Corporation

Exchange

NYSE

Sector

Consumer Services

Industry

Marine Transportation

Market Cap.

42.80B

Vuru Grade

52.15/100

Current Price

$58.95
-0.31 (-0.52%)

Growth Price

$56.24
Fairly valued

Company Metrics

  • P/E 15.85
  • P/S 2.63
  • P/B 1.9
  • EPS 3.72
  • Cash ROIC 4.15%
  • Cash Ratio 0.09
  • Dividend 1.4 / 2.39%
  • Avg. Vol. 3.05M
  • Shares 726.04M
  • Market Cap. 42.80B

Company Description

Carnival Corporation operates as a cruise and vacation company. It provides cruises to various vacation destinations with a portfolio of cruise brands comprising Carnival Cruise Lines, Holland America Line, Princess Cruises, and Seabourn in North America; and AIDA Cruises, Costa Cruises, Cunard, Ibero Cruises, and P&O Cruises in Europe, Australia, and Asia. The company also involves in operation o... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Carnival Corp.'s first-quarter profit more than doubles to $352 million ...
Sun Sentinel - Mar 28, 2017
"Our company is off to a good start again this year," Carnival Corp. President and CEO Arnold Donald told analysts during a conference call Tuesday.
Carnival Corp. (CCL) Tops Q1 EPS by 3c - StreetInsider.com
Carnival Corp reports first quarter earnings decline but raises full year guidance - Proactive Investors UK
Bookings surge sees Carnival Corp's share price soar
Travel Weekly UK - 11 hours ago
Shares in Carnival Corporation soared to a record high yesterday as the cruise giant revealed that 2017 forward bookings are outpacing last year at “considerably higher” prices.
Cruises To The Caribbean Helping Drive Good Carnival Performance - Caribbean360.com (subscription)
CARIBBEAN: Cruises to the Caribbean helping drive good Carnival performance - St. Lucia News Online (press release)
Carnival Corp Chief Strategy Officer and Cunard SVP Josh Leibowitz Defends ...
Yahoo Finance - Mar 27, 2017
VALENCIA, Calif., March 27, 2017 /PRNewswire/ -- Josh Leibowitz, Senior Vice President for Cunard North America and Chief Strategy Officer for Carnival Corp, was part of the panel "Guest-centricity Delivers on the Experience of Travel" at the Adobe ...
Carnival Corp. Opens Seattle Fleet Operations Center
GCaptain - Mar 14, 2017
Miami-based Carnival Corporation has opened its second Fleet Operations Center in Seattle that will be used to provide real-time support for the company's 102-ship fleet.
Carnival Corporation Expands Global Fleet Operations Centers, A First in ... - PR Newswire (press release)
Carnival Corp. hikes safety with new Fleet Operations Center in Seattle - Seatrade Cruise News
Carnival Corp (CCL) Issues FY17 Earnings Guidance
The Cerbat Gem - 7 hours ago
Carnival Corp logo Carnival Corp (NYSE:CCL) updated its FY17 earnings guidance on Tuesday. The company provided EPS guidance of $3.50-3.70 for the period, compared to the Thomson Reuters consensus EPS estimate of $3.61.
Carnival Corp (CCL) PT Raised to $61.00 at Wedbush - Chaffey Breeze
Wedbush Just Issued “Neutral” Rating on Carnival Corp (CCL) - Highland Mirror
Carnival Corp. adds gas exhaust cleaning systems to 60 ships
Sun Sentinel - Feb 27, 2017
Cruise operators are advancing initiatives to reduce the environmental impact of their ships on the destinations they visit around the globe.
Carnival Corp. now plans scrubbers on more than 85 ships - Seatrade Cruise News
Analyst Upgrades – Carnival Corp (NYSE:CCL) Stock Gets Upgraded By Argus from ... - Market Exclusive
Woman blames Carnival Corp.'s alleged negligence for knee injury
Florida Record - Mar 24, 2017
The plaintiff holds Carnival Corp., doing business as Carnival Cruise Lines, responsible because the defendant's staff allegedly failed to properly, adequately and/or completely clean up the spilled water, and failed to warn plaintiff and other ...
The Carnival Corp (CCL) Reaches New 12-Month High Following Analyst Upgrade - Petro Global News 24
Analyst Activity – Stifel Nicolaus Raises Its Price Target On Carnival Corp ...
Market Exclusive - Mar 22, 2017
Today, Stifel Nicolaus raised its price target on Carnival Corp (NYSE:CCL) to $65.00 per share. There are 1 sell rating, 7 hold ratings, 15 buy ratings on the stock.
Carnival Corp (CCL) PT Raised to $65.00 - The Cerbat Gem
Carnival Corp (CCL) Upgraded to “Outperform” at William Blair - Petro Global News 24
Carnival Corp. veteran takes on new strategic Caribbean role
Seatrade Cruise News - Mar 22, 2017
McKenzie will provide an additional layer of engagement with governments and communities in the region that comprises a third of Carnival Corp.'s capacity this year. She now reports to Giora Israel, svp global port and destination development. The ...
Arnold W. Donald, CEO of Carnival Corp. to Headline ASTA's 2017 Global Convention
TravelPulse - Mar 9, 2017
Arnold W. Donald, president and CEO of Carnival Corporation, will attend ASTA's 2017 Global Convention (AGC) slated for Aug. 27 to 29 in San Diego.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for CCL to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate CCL's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$58.95 Current Price

$56.24 Growth Price (DCF)

Fairly valued


Growth Rate Assumed by Market: 10.39%


Future Free Cash Flow Growth Rate: 7.9%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$39.74 Book Price

Overvalued by 32.58%


Poor Cash Return on Invested Capital over the past 5 years

CCL has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

CCL has only created $4.15 of cash for every $100 invested.
Figures in USD. Fiscal year ends in November
20122013201420152016
Free Cash Flow 667.00M 685.00M 847.00M 2.25B 2.07B
divided by
Invested Capital 31.36B 32.92B 32.28B 30.89B 31.26B
Cash ROIC 2.13% 2.08% 2.62% 7.29% 6.63%

Poor Return on Equity over the past 5 years

CCL has shown an inability to deliver strong results for shareholders. This could be due to poor management, CCL operating in a highly competitive industry, or having a weak business in general.

CCL has only generated $6.92 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in November
20122013201420152016
Net Income 1.30B 1.08B 1.24B 1.76B 2.78B
divided by
Stockholders' Equity 23.93B 24.56B 24.29B 23.77B 22.60B
Return on Equity 5.42% 4.39% 5.09% 7.39% 12.30%

Excellent Business Performance over the past 10 years

CCL has been able to maintain profitability in good times and bad. This could mean CCL has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

CCL has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Free Cash Flow 757.00M 38.00M -38.00M 239.00M 1.07B 667.00M 685.00M 847.00M 2.25B 2.07B

Good Balance Sheet

CCL's Total Assets double Total Liabilities. Its financial position is adequate. Remember to check Shareholders' Equity to see if it's stable or growing. It's one of the best measures of whether a company is creating value for shareholders.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Cash 943.00M 650.00M 538.00M 429.00M 450.00M 465.00M 462.00M 331.00M 1.40B 603.00M
Current Assets 1.98B 1.65B 1.52B 1.24B 1.31B 1.82B 1.94B 1.50B 2.45B 1.69B
Total Assets 34.18B 33.40B 36.84B 37.49B 38.64B 39.16B 40.10B 39.53B 39.24B 38.94B
Current Liabilities 7.26B 5.78B 4.97B 5.76B 6.11B 7.34B 6.72B 6.92B 6.96B 7.07B
Total Liabilities 14.22B 14.30B 14.80B 14.46B 14.81B 15.23B 15.55B 15.24B 15.47B 16.34B
Stockholder' Equity 19.96B 19.10B 22.04B 23.03B 23.83B 23.93B 24.56B 24.29B 23.77B 22.60B
Current Ratio 0.27 0.29 0.31 0.22 0.21 0.25 0.29 0.22 0.35 0.24
TL-to-TA 0.42 0.43 0.40 0.39 0.38 0.39 0.39 0.39 0.39 0.42

Consistent Reinvestment of Profits over the past 10 years

CCL has consistently retained profits. This may put CCL in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, CCL can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Retained Earnings 12.92B 13.98B 15.77B 17.22B 18.35B 18.48B 18.78B 19.24B 20.06B 21.84B
Retained Earnings Growth - 8.20% 12.80% 9.22% 6.53% 0.71% 1.64% 2.45% 4.25% 8.89%

Potential Competitive Advantage over the past 10 years

CCL potentially has a competitive advantage. This could be strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will strengthen.

$12.51 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Net Income 2.41B 2.33B 1.79B 1.98B 1.91B 1.30B 1.08B 1.24B 1.76B 2.78B
divided by
Revenue 13.03B 14.65B 13.16B 14.47B 15.79B 15.38B 15.46B 15.88B 15.71B 16.39B
Net Profit Margin 18.48% 15.91% 13.60% 13.67% 12.11% 8.44% 6.97% 7.78% 11.18% 16.96%

Satisfactory Pricing Power over the past 10 years

Consistency is vital. CCL has been able to maintain gross margins fairly consistently, which is a strong indication of their ability to raise prices with inflation. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$37.14 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Gross Profit 5.41B 5.61B 5.05B 5.38B 5.49B 5.06B 4.83B 5.48B 6.27B 7.01B
divided by
Revenue 13.03B 14.65B 13.16B 14.47B 15.79B 15.38B 15.46B 15.88B 15.71B 16.39B
Gross Margin 41.47% 38.28% 38.41% 37.16% 34.79% 32.91% 31.26% 34.51% 39.88% 42.75%

High Capital Intensity over the past 10 years

CCL spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

162.10% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Capital Expenditure 3.31B 3.35B 3.38B 3.58B 2.70B 2.33B 2.15B 2.58B 2.29B 3.06B
divided by
Net Income 2.41B 2.33B 1.79B 1.98B 1.91B 1.30B 1.08B 1.24B 1.76B 2.78B
Capital Expenditure Ratio 137.54% 143.91% 188.83% 180.94% 141.00% 179.66% 199.35% 208.98% 130.56% 110.18%

Very Strong Dividend History over the past 10 years

CCL has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests CCL is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Dividend Paid 990.00M 1.26B 314.00M 237.00M 671.00M 779.00M 1.16B 776.00M 816.00M 977.00M
divided by
Shares Outstanding 816.27M 816.00M 804.00M 805.00M 789.00M 779.00M 777.00M 778.00M 779.00M 747.00M
Dividend Paid Per Share 1.21 1.55 0.39 0.29 0.85 1.00 1.50 1.00 1.05 1.31
Price at Year End 41.28 23.07 30.63 44.31 32.37 36.03 40.14 45.48 55.04 52.06
Dividend Yield 2.94% 6.70% 1.28% 0.66% 2.63% 2.78% 3.73% 2.19% 1.90% 2.51%

Strong History of Stock Buybacks over the past 10 years

CCL has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in November
2007200820092010201120122013201420152016
Shares Outstanding 816.27M 816.00M 804.00M 805.00M 789.00M 779.00M 777.00M 778.00M 779.00M 747.00M
Stock Bought Back - 0.03% 1.49% -0.12% 2.03% 1.28% 0.26% -0.13% -0.13% 4.28%
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Discussion
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2
Posted by pbanik  (on August 20, 2012)
CJKnox is correct. It's a so-so stock, but there are better opportunities out there if you look for them. I would say CCL is probably fairly valued.
1
Posted by CJKnox  (on August 16, 2012)
CCL is doing fine, not great but fine, considering the economic climate and considering that they've weathered many economic storms before, they are a good investment......for the long term investor.
0
Posted by A3thbklamy  (on August 18, 2012)
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