Carnival Corporation (CCL): Today's Featured Services 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 Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day up 0.8%. By the end of trading, Carnival Corporation fell 57 cents (-1.6%) to $35.67 on average volume. Throughout the day, 5.7 million shares of Carnival Corporation exchanged hands as compared to its average daily volume of 4.6 million shares. The stock ranged in price between $35.52-$36.39 after having opened the day at $36.12 as compared to the previous trading day's close of $36.24. Other companies within the Services sector that declined today were: Bluefly ( BFLY), down 21.2%, FreeSeas ( FREE), down 10.3%, Envoy Capital Group ( ECGI), down 9.8%, and Luna Innovations ( LUNA), down 9.4%.
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Carnival Corporation operates as a cruise and vacation company worldwide. The company operates in two segments, North America; and Europe, Australia, and Asia. Carnival Corporation has a market cap of $21.41 billion and is part of the leisure industry. The company has a P/E ratio of 21.6, above the S&P 500 P/E ratio of 17.7. Shares are down 1.7% year to date as of the close of trading on Thursday. Currently there are six analysts that rate Carnival Corporation a buy, no analysts rate it a sell, and nine 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 reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, Acquity Group Ltd ADR ( AQ), up 37.8%, Information Services Group ( III), up 26.4%, Paragon Shipping ( PRGN), up 18.9%, and Pandora Media ( P), up 17.6%, were all gainers within the services sector with Time Warner ( TWX) being today's featured services sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the services sector could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the services sector could consider ProShares Ultra Short Consumer Sers ( SCC).

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