Actions of Carnival (NYSE: CCL)(NYSE: CUK) closed the week 2.3% higher on Friday after an analyst raised his cruise line price target due to improving industry fundamentals.
Citigroup Analyst James Ainley raised his price target on Carnival from $ 30 to $ 34, saying the decline in cruise stock offered investors an “excellent entry point.”
Ainley highlighted the results report released by Royal Caribbean (NYSE: RCL) Wednesday, indicating that he viewed it as a strong commentary on the company. The market agreed, as it pushed stocks up 7% yesterday, although today the stock has practically leveled off.
Carnival’s stock is down 26% from recent highs reached in early June over fears the delta variant of COVID-19 could dampen the recovery of the travel and tourism industry, which had only just begun.
Carnival’s Princess Cruises brand recently completed its first Alaska route and announced its Alaska schedule for the 2023 boating season yesterday.
The company also rebounded from earnings from Royal Caribbean and continued to grow today, perhaps because it is the largest in the industry. Just as it takes a long time to turn a large ship around, once it has formed it is not easy to stop. And it might be best to get on board to avoid its wake.
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