Carnival Corporation & Plc’s CCL Costa Cruises recently announced it will continue to gradually resume cruise operations in an organized and responsible manner. In an effort to provide enhanced cruise experience and heightened health protocols, Costa Cruises has reshaped its itineraries for the rest of 2021, after the presentation of its cruises for the 2020-21 winter season. Following the news, the company’s shares gained 9.7% on Sep 25.
The company will deploy three ships namely — Costa Smeralda, Costa Firenze and Costa Pacifica in the Western Mediterranean from March until fall of 2021. Costa Cruises also announced that it will operate three additional ships in the Eastern Mediterranean, all on one-week itineraries.
Further, during the summer season of 2021, Costa Cruises will operate four ships in Northern Europe. During spring and fall 2021, Costa Fortuna, Costa Diadema, Costa Favolosa and Costa Fascinosa will operate in the Mediterranean.
Nonetheless, apprehensions regarding the novel coronavirus are far from over. Norway’s shipping and cruise liner Hurtigruten, which recently resumed operations, experienced an outbreak of COVID-19 aboard its new hybrid exploration ship MS Roald Amundsen. Consequently, it had to cancel all its operations.
Coming to price performance, shares of Carnival have plunged 70.3% so far this year, compared with the industry's decline of 43.6%. Notably, the company has been negatively impacted by the coronavirus pandemic. Although the company cannot estimate the impact of the COVID-19 outbreak at this time, it is likely that the pandemic will have an adverse effect on its operations in rest of 2020. Also, the pandemic is likely to cause delay in ship deliveries as the shipyards have been impacted.
Carnival — which shares space with Norwegian Cruise Line Holdings Ltd. NCLH and Royal Caribbean Cruises Ltd. RCL — has a Zacks Rank #5 (Strong Sell) at present.
A Key Pick
A better-ranked stock in the leisure space is Twin River Worldwide Holdings, Inc. TRWH , which carries a Zacks Rank # 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Twin River Worldwide’s 2021 earnings are expected to soar 273.5%.
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Carnival Corporation (CCL) : Free Stock Analysis Report
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