Marine Shipping company Carnival is standing out today, surging to $23.7 and marking a 3.4% change. In comparison the S&P 500 moved only -0.0%. CUK is -31.32% below its average analyst target price of $34.5, which implies there is more upside for the stock. Over the last year, Carnival has underperfomed the S&P 500 by 11.0%, moving 0.4%.
Carnival Corporation & plc, a cruise company, provides leisure travel services in North America, Australia, Europe, and internationally. The company is a consumer cyclical company, whose sales figures depend on discretionary income levels in its consumer base. For this reason, consumer cyclical companies have better sales and stock performance during periods of economic growth, when consumers have more of an incentive to spend their money on non-essential items.
Carnival's trailing 12 month P/E ratio is 12.2, based on its trailing EPS of $1.94. The company has a forward P/E ratio of 11.1 according to its forward EPS of $1.68 -- which is an estimate of what its earnings will look like in the next quarter.
The P/E ratio is the company's share price divided by its earnings per share. In other words, it represents how much investors are willing to spend for each dollar of the company's earnings (revenues minus the cost of goods sold, taxes, and overhead). As of the third quarter of 2024, the consumer discretionary sector has an average P/E ratio of 20.93, and the average for the S&P 500 is 29.3.
Value investors often analyze stocks through the lens of its Price to Book (P/B) Ratio (market value divided by book value). The book value refers to the present value of the company if the company were to sell off all of its assets and pay all of its debts today - a number whose value may differ significantly depending on the accounting method.
Carnival has a P/B ratio of 2.61. This indicates that the market value of the company exceeds its book value by a factor of more than 2, but is still below the average P/B ratio of the Consumer Discretionary sector, which stood at 2.93 as of the third quarter of 2024.
Carnival is by most measures overvalued because it has a Very low P/E ratio, an average P/B ratio, and No published cashflows with an unknown trend. The stock has poor growth indicators because it has a a negative PEG ratio and weak operating margins with a stable trend. We hope you enjoyed this overview of CUK's fundamentals.
