Updated from 9:42 a.m. EDT
, the largest cruise operator in the world, fell 6% after the company reported earnings Tuesday that exceeded Wall Street's expectations by 3 cents but also warned that earnings for the full year will only be "slightly" higher than last year.
Shares of Carnival closed at 18 11/16, down 4 11/16 or 20%, after reaching a 52-week low of 20. The company's shares are down almost 60% from the beginning of 2000.
For the second quarter ended May 31, the operator of the
cruise lines said that net income rose to $204 million, or 34 cents a diluted share, from $203.3 million, or 33 cents a share, a year earlier. Second-quarter 2000 earnings benefited from a one-time net gain of $10.7 million from Carnival's affiliated operations.
The consensus estimate of analysts polled by
First Call/Thomson Financial
was 31 cents, a number that had been lowered after the Miami-based company
guided estimates downward for the second quarter during its first-quarter earnings conference call.
Revenue rose to $875.1 million from $796.1 million a year ago.
Earnings for the second quarter were constrained by a combination of lower net revenue yields and significantly higher fuel costs, said Micky Arison, chairman and chief executive of Carnival, in a statement.
For the full fiscal year, earnings per share will be slightly higher than last year, which came in at $1.66. The current consensus stands at $1.79. Meanwhile, net revenue yields for the second half of 2000 will be "somewhat less" than last year, the company said.
The stock of cruise operators like Carnival have been hit on fears that a possible slowdown in the economy will result in a lack of passengers to fill up new ships that are being built.
In fact, Carnival launched Holland America's 1,440-passenger Zaandam last month and has three more ships -- with available capacity for a total of 6,250 passengers -- scheduled to enter service this year.
"It will take a number of catalysts to drive the stock higher," said Brian Egger, an analyst at
Donaldson, Lufkin and Jenrette
. "We'll have to see that pricing has stabilized and that there's a benefit with regard to relief from fuel prices." He rates Carnival a buy and his firm has done no recent underwriting for the company.