CCL Sees Record Pricing Despite Weak Sentiment: What's Driving Demand?

Carnival Corporation & plc CCL delivered record financial performance in fiscal 2025, closing the year with historical highs in revenues, yields, operating income and EBITDA. Full-year net income exceeded $3 billion, representing a 60% year-over-year increase, while yields rose more than 5.5% and surpassed initial guidance. Management noted that record results were achieved across all four quarters, reflecting consistent execution across the company’s global portfolio.

Demand trends remained resilient despite prolonged weakness in U.S. consumer sentiment during 2025. Management highlighted that pricing in both North America and Europe reached historical highs, while booking volumes over the past three months set records for 2026 and 2027 sailings. Customer deposits increased 7% year over year to an all-time high at year-end, and fourth-quarter onboard revenue per diem significantly exceeded prior-year levels, supported by strong close-in demand.

Carnival attributed its performance to disciplined revenue management and the benefits of its diversified brand portfolio. Management emphasized a focus on maximizing total revenues rather than prioritizing occupancy, allowing pricing integrity to be maintained while supporting higher ticket prices and onboard spending. Bundled offerings and targeted promotions continue to play a role in balancing volume and yield across itineraries and regions.

Looking to 2026, management guided to additional yield growth of approximately 2.5%, or about 3% when normalized for accounting changes and deployment adjustments. This outlook incorporates elevated industry capacity growth in the Caribbean and ongoing macro uncertainty. With no new ship deliveries scheduled for the year, the company expects cost growth to remain manageable through continued cost mitigation efforts and scale efficiencies.

Overall, management reiterated confidence in the durability of cruise demand, citing the value proposition of cruising relative to land-based alternatives and the company’s ability to adapt across markets. With a significant portion of 2026 already booked at higher prices and continued momentum in onboard revenues, Carnival is positioned to build on its record operating performance.

CCL’s Price Performance, Valuation & Estimates

Shares of Carnival have gained 24.7% in the past three months compared with the industry’s growth of 5%. In the same time frame, other industry players like Royal Caribbean Cruises Ltd. RCL, Norwegian Cruise Line Holdings Ltd. NCLH and OneSpaWorld Holdings Limited OSW have risen 17.8%, 29.9% and 7.1%, respectively.

CCL Stock’s Three-Month Price Performance

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CCL stock is currently trading at a discount. It is currently trading at a forward 12-month price-to-earnings (P/E) multiple of 12.18, well below the industry average of 16.15. Conversely, industry players, such as Royal Caribbean, Norwegian Cruise and OneSpaWorld, have P/E ratios of 16.92, 9.12 and 19.25, respectively.

CCL’s P/E Ratio (Forward 12-Month) vs. Industry

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The Zacks Consensus Estimate for Carnival’s fiscal 2026 earnings per share has been revised upward, increasing from $2.49 to $2.54 over the past 60 days. This upward trend indicates strong analyst confidence in the stock’s near-term prospects.

EPS Trend of CCL Stock

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The company is likely to report solid earnings, with projections indicating a 12.9% rise in fiscal 2026. Conversely, industry players like Royal Caribbean, Norwegian Cruise and OneSpaWorld are likely to witness a gain of 15.7%, 15.9% and 12.1%, respectively, year over year in 2026 earnings.

CCL stock currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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Carnival Corporation (CCL): Free Stock Analysis Report

Royal Caribbean Cruises Ltd. (RCL): Free Stock Analysis Report

Norwegian Cruise Line Holdings Ltd. (NCLH): Free Stock Analysis Report

OneSpaWorld Holdings Limited (OSW): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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