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Although the travel industry seems to have returned to work when the Covid-19 epidemic was defeated, a lot of travel stockHe couldn’t ride the wave of travel demand. Hotel, airline and cruise inventory The price is variable or reduced as the number of travelers and bookings increase.
on the. Inflation is a concern. For the industry, it raises prices and hurts consumers’ willingness to spend on luxury travel. Moreover, geopolitical instability and manpower challenges are another headwind.
Ppersistent inflation in China with factors such as high energy prices, labor shortages and lockouts; Reimbursement of international business travel expenses may be delayed. to pre-epidemic levels.
Against this backdrop, we think it may be better to avoid fundamentally weaker travel stocks. Carnival Corporation and Pvt.CCL) and Royal Caribbean Cruises Ltd.RCL).
Carnival Corporation and Pvt.CCL)
CCL operates as a leisure travel company. Its ships operate under the Carnival Cruise Line, Princess Cruises, Holland America Line, P&O Cruises (Australia), Seaborne, Costa Cruises, AIDA Cruises, P&O Cruises (UK) and Cunard brands.
In the year On August 17, CCL announced that Carnival Corporation, Carnival Plc and certain of their subsidiaries have entered into a separately negotiated exchange agreement pursuant to which the company expects to exchange $339 million in aggregate outstanding notes for $339 million. Principal amount of new 5.75% Convertible Senior Notes due October 2024. On August 22, CCL announced the closing of the offering.
In the second fiscal quarter ended May 31, CCL’s operating costs and expenses rose 132.7 percent year-over-year to $3.87 billion. Adjusted EBITDA Earnings were negative at $928 million. The company’s adjusted net loss was $1.87 billion and its loss per share was $1.61.
Analysts expect CCL’s EPS to be a negative $0.15 for the fiscal third quarter ending in August. Revenue is expected to reach $4.91 billion in the same quarter.
It has fallen 54.3% over the past year to close at $10.76. It was down 46.5% year-on-year.
This bad attitude is reflected in CCL POWR standards. The stock has an overall rating of D, which equates to a sell in our proprietary rating system. POWR ratings are calculated by considering 118 different scenarios, each rating up to an optimal level.
CCL is rated F for comfort and feel and D for value and quality. It is ranked #2 of the four stocks in the F-rated travel-cruise industry.
In addition to the POWR ratings above, you can also look at the CCL ratings for growth and momentum. over here.
Royal Caribbean Cruises Ltd.RCL)
RCL operates as a global cruise company. Royal Caribbean International owns and operates global cruise brands including Celebrity Cruises, Azamara and Silversea Cruises.
In the year On August 18, RCL announced the completion of a private offering of 11.625% senior unsecured notes totaling $1.25 billion to repay principal payments due 2022 and 2023. .
For the second quarter ended June 30, 2022, RCL Adjusted net loss for the second quarter of 2022 was $521.52 million and $2.08 per share. The operating loss stood at $218.64 million.
RCL’s EPS is expected to be $0.20 for the third fiscal quarter in September 2022, with revenue expected to come in at $2.99 billion.
The stock is down 39.8% over the past year and 34.4% year-to-date to close at $50.44.
RCL’s POWR ratings reflect its weak prospects. The stock has an overall rating of F, which equates to a strong sell in our proprietary rating system.
The RCL has an F rating for stability and feel and a D for value and quality. RCL is ranked #3 in the same industry.
Click here To see more POWR ratings for RCL (Momentum and Growth).
Shares of CCL were trading up $0.06 (+0.56%) at $10.82 on Monday afternoon. Year-to-date, CCL is down -46.22%, while the benchmark S&P 500 index is up -17.68% over the same period.
About the Author: Kritika Sarmah
Her interest in dangerous instruments and love of writing has made her a critical analyst and financial journalist. She holds a bachelor’s degree in commerce and is currently pursuing a CFA program. At her core, her approach is to help investors identify untapped investment opportunities. More…
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