Carnival Corp.'s (CCL) - Get Report Cunard has canceled sailings until November due to coronavirus pandemic-related travel restrictions, while a Stifel analyst raised his price target for the cruise ship operator.
Shares of the Miami-based company were down 5.7% to $23.52 in pre-market trading on Tuesday.
Cunard President Simon Palethorpe said the cruise line is canceling all sailings on the Queen Elizabeth ship departing through Nov. 23, as well as those on Queen Mary 2 and Queen Victoria through Nov. 1.
In April, the company canceled Queen Mary 2 and Queen Victoria sailings that were due to depart up to and including July 31. For Queen Elizabeth, the cruise line canceled the entire Alaska season and all departures up to and including Sept. 8.
Palethorpe said Cunard is working with the U.S. Centers for Disease Control and Prevention, Public Health England, the trade group Cruise Lines International Association and medical professionals to develop health and safety protocols.
Carnival Cruise Line, is set to resume eight cruises beginning Aug. 1.
Other Carnival lines, including Princess Cruises, AIDA Cruises and P&O Cruises, have also extended sailing cancellations and the Canadian government has extended its sailing restriction for cruise ships carrying more than 100 passengers through Oct. 31.
Separately, Stifel analyst Steven Wieczynski raised his price target on Carnival to $30 from $17, telling investors in a note that "there is no clear answer" when cruising resumes.
"Bottom line, though, is that without a massive reoccurrence of the virus, we believe CCL could start to see their business stabilize through 2021 and return to 2019 EBITDA levels sooner than what we were previously forecasting," Wieczynski said.
While trying to model what two years down the road will look like for a cruise operator given what’s going on in the world right now is nearly impossible, the analyst added, "based on what we have seen from current booking trends and conversations we have had with multiple travel agents, we believe a recovery could be coming well sooner than we were previously forecasting."
Carnival did not immediately respond to a request for comment.