Update (9:40 a.m.): Updated with Monday market open information.
NEW YORK (TheStreet) -- UBS increased its target price on Carnival (CCL) to $43 and set a "buy" rating. The firm cited higher booking volume with 2H yield looking to turn positive as the reason for the move.
The stock was rising 1.47% to $39.39 at 9:36 a.m. on Tuesday.
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Separately, TheStreet Ratings team rates CARNIVAL CORP/PLC (USA) as a "buy" with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CARNIVAL CORP/PLC (USA) (CCL) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- CCL's revenue growth has slightly outpaced the industry average of 5.6%. Since the same quarter one year prior, revenues slightly increased by 2.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- The current debt-to-equity ratio, 0.39, 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 0.19 is very weak and demonstrates a lack of ability to pay short-term obligations.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- CARNIVAL CORP/PLC (USA)'s earnings per share declined by 33.3% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, CARNIVAL CORP/PLC (USA) reported lower earnings of $1.38 versus $1.67 in the prior year. This year, the market expects an improvement in earnings ($1.70 versus $1.38).
- You can view the full analysis from the report here: CCL Ratings Report