What Lies Ahead For Carnival Stock After A Solid Month?

CCL: Carnival logo
CCL
Carnival

Carnival (NYSE:CCL), the largest cruise line operator, has seen its stock price rise by 32% over the last month (about 21 trading days). So what’s driving the recent surge? Firstly, the broader markets have fared well over the past month, as the U.S. Federal Reserve has slowed down its pace of interest rate hikes, with the most recent increase standing at just 25 basis points. For perspective, the S&P 500 was up by over 8% over the last month.  The broader positive sentiment appears to have helped CCL disproportionately, considering that it still remains down by over 75% from its 2020 highs. The fundamentals for the cruising industry have also picked up in recent months, with demand appearing strong in terms of bookings, average pricing, and onboard spending, despite some concerns about an economic slowdown. Multiple brokerages are also positive on cruising stocks and this could also be helping Carnival.

However, now that CCL stock has seen a rise of about 32% over the last month, will it continue its upward trajectory in the near term, or is a decline imminent? Going by historical performance, there is only a 26% chance of a rise in CCL stock over the next month. There were 46 instances in the last 10 years when Carnival (CCL) stock saw a trailing 21-day rise of 32% or more 12 of those instances resulted in CCL stock rising over the subsequent one-month period (21 trading days). This historical pattern reflects 12 out of 46, or about a 26% chance of a rise in Carnival stock over the next month. See our analysis on Carnival Chance of Rise for more details.

Calculation of ‘Event Probability’ and ‘Chance of Rise’ using the last ten years data

  • After moving 11% or more over five days, the stock rose in the next five days on 49% of the occasions.
  • After moving 10% or more over ten days, the stock rose in the next ten days on 49% of the occasions.
  • After moving 32% or more over a twenty-one-day period, the stock rose in the next twenty-one days on 26% of the occasions.

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 Returns Feb 2023
MTD [1]
2023
YTD [1]
2017-23
Total [2]
 CCL Return 9% 46% -77%
 S&P 500 Return 1% 8% 85%
 Trefis Multi-Strategy Portfolio 3% 15% 261%

[1] Month-to-date and year-to-date as of 2/5/2023
[2] Cumulative total returns since the end of 2016

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