Trade-Ideas: Carnival Corporation (CCL) Is Today's Pre-Market Laggard Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Carnival Corporation ( CCL) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Carnival Corporation as such a stock due to the following factors:

  • CCL has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $176.0 million.
  • CCL traded 221,241 shares today in the pre-market hours as of 8:00 AM.
  • CCL is down 5% today from yesterday's close.

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More details on CCL:

Carnival Corporation operates as a cruise and vacation company worldwide. The company operates in two segments, North America; and Europe, Australia, and Asia. The stock currently has a dividend yield of 2.7%. CCL has a PE ratio of 19.2. Currently there are 4 analysts that rate Carnival Corporation a buy, no analysts rate it a sell, and 11 rate it a hold.

The average volume for Carnival Corporation has been 3.4 million shares per day over the past 30 days. Carnival has a market cap of $21.9 billion and is part of the services sector and leisure industry. The stock has a beta of 1.16 and a short float of 5% with 2.90 days to cover. Shares are up 0.8% year to date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Carnival Corporation as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including poor profit margins, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Hotels, Restaurants & Leisure industry. The net income increased by 192.8% when compared to the same quarter one year prior, rising from $14.00 million to $41.00 million.
  • The current debt-to-equity ratio, 0.42, is low and is below the industry average, implying that there has been successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.22 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • In its most recent trading session, CCL has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The gross profit margin for CARNIVAL CORP/PLC (USA) is currently lower than what is desirable, coming in at 28.05%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.17% significantly trails the industry average.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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