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Carnival Stock
By Dave | April 3, 2009
For quite a few years, probably since about 2002, I wanted to buy stock in Carnival. Back then I had no money, and when I finally did have some money to buy stock, Carnival’s price was in the $40s. Well, several days ago, I checked out CCL again just out of curiosity. To my surprise, it was about $20. Apparantly it went as low as about $15. So I’m reconsidering purchasing stock in Carnival again. Since I’m not filthy rich, I’d like for it to go back down to $15 again before I buy, but anything below $20 would be very reasonable for me.
Based on what I’ve been reading, it seems like it could be a good stock to buy too, at least compared to other cruise stocks. From what I’ve heard, RCI is having trouble financing their two new ships (or to-be ships), and their CEO said he does not want to lower prices. So they’re sailing with empty cabins and are having trouble getting financing for their ships. Their S&P rating has also fallen to a BB-, compared to Carnival’s BBB+.
There’s no doubt Carnival has also been hurting recently due to the economy and prior to that, gas prices. But compared to RCI, they seem to be doing well. They’ve halted new ship building so they won’t be carrying much new debt. They’re also discounting their fares so they sail with near-capacity ships. Empty cabins don’t bring in any revenue on board. Occupied cabins, whether paid in full or discounted, are much more likely to. In addition, Carnival CEO Gerry Cahill has said Carnival won’t be making any cutbacks that are similar to RCI. That doesn’t mean they won’t cut anything, but things like past guest perks will not be affected. Smart move on Carnival’s part, in my opinion. John Heald has also alluded to the fact that new changes are in the works, but he didn’t mention anything specifically.
So, I will be following the Carnival stock closely. And if the price is right, I’ll make the buy.
In other news, 120 days until the Legend!
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