Carnival Corporation (CCL): Today's Featured Leisure Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Carnival Corporation ( CCL) pushed the Leisure industry lower today making it today's featured Leisure laggard. The industry as a whole closed the day up 0.2%. By the end of trading, Carnival Corporation fell 81 cents (-2.1%) to $37.85 on average volume. Throughout the day, 3.7 million shares of Carnival Corporation exchanged hands as compared to its average daily volume of 3.4 million shares. The stock ranged in price between $37.83-$38.76 after having opened the day at $38.73 as compared to the previous trading day's close of $38.66. Other companies within the Leisure industry that declined today were: BJ's Restaurants ( BJRI), down 15.7%, Texas Roadhouse ( TXRH), down 3.8%, Nevada Gold & Casinos ( UWN), down 3.6%, and AFC ( AFCE), down 3.6%.
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Carnival Corporation operates as a cruise and vacation company worldwide. Carnival Corporation has a market cap of $22.45 billion and is part of the services sector. The company has a P/E ratio of 20.6, below the average leisure industry P/E ratio of 26.1 and above the S&P 500 P/E ratio of 17.7. Shares are up 15.7% year to date as of the close of trading on Thursday. Currently there are seven analysts that rate Carnival Corporation a buy, no analysts rate it a sell, and eight rate it a hold.

TheStreet Ratings rates Carnival Corporation as a buy. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins, increase in stock price during the past year and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Expedia ( EXPE), up 15.2%, Orbitz Worldwide ( OWW), up 13.1%, Town Sports International Holdings ( CLUB), up 11.1%, and Red Lion Hotels Corporation ( RLH), up 4.5%, were all gainers within the leisure industry with Buffalo Wild Wings ( BWLD) being today's featured leisure industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the leisure industry could consider PowerShares Dynamic Leisure&Entert ( PEJ) while those bearish on the leisure industry could consider ProShares Ultra Sht Consumer Services ( SCC).

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