Financial Analysis: Carnival (CCL) vs. Its Rivals

Carnival (NYSE:CCL) is one of 382 publicly-traded companies in the “Hotels, Restaurants & Leisure” industry, but how does it contrast to its competitors? We will compare Carnival to similar companies based on the strength of its risk, institutional ownership, earnings, valuation, profitability, dividends and analyst recommendations.

Valuation & Earnings

This table compares Carnival and its competitors gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Carnival	$26.62 billion	$2.76 billion	13.39
Carnival Competitors	$3.42 billion	$250.20 million	-161.64

Carnival has higher revenue and earnings than its competitors. Carnival is trading at a higher price-to-earnings ratio than its competitors, indicating that it is currently more expensive than other companies in its industry.

Risk & Volatility

Carnival has a beta of 2.48, meaning that its stock price is 148% more volatile than the S&P 500. Comparatively, Carnival’s competitors have a beta of 1.44, meaning that their average stock price is 44% more volatile than the S&P 500.

Insider and Institutional Ownership

67.2% of Carnival shares are owned by institutional investors. Comparatively, 48.7% of shares of all “Hotels, Restaurants & Leisure” companies are owned by institutional investors. 7.9% of Carnival shares are owned by company insiders. Comparatively, 22.1% of shares of all “Hotels, Restaurants & Leisure” companies are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Dividends

Carnival pays an annual dividend of $0.60 per share and has a dividend yield of 2.0%. Carnival pays out 26.2% of its earnings in the form of a dividend. As a group, “Hotels, Restaurants & Leisure” companies pay a dividend yield of 3.2% and pay out 38.8% of their earnings in the form of a dividend.

Profitability

This table compares Carnival and its competitors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Carnival	11.37%	24.83%	6.32%
Carnival Competitors	2.45%	-40.43%	2.13%

Analyst Recommendations

This is a breakdown of current ratings and target prices for Carnival and its competitors, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Carnival	0	8	22	1	2.77
Carnival Competitors	3812	17303	25622	907	2.50

Carnival presently has a consensus target price of $34.16, indicating a potential upside of 11.44%. As a group, “Hotels, Restaurants & Leisure” companies have a potential upside of 58.35%. Given Carnival’s competitors higher probable upside, analysts plainly believe Carnival has less favorable growth aspects than its competitors.

Summary

Carnival beats its competitors on 12 of the 15 factors compared.

Carnival Company Profile

Carnival Corp. engages in the operation of cruise ships. It operates through the following business segments: North America and Australia (NAA) Cruise, Europe and Asia (EA) Cruise Operations, Cruise Support, and Tour and Others. The North America and Australia (NAA) Cruise segment includes the Carnival Cruise Line, Holland America Line, Princess Cruises, and Seabourn. The Europe and Asia (EA) Cruise Operations segment consists of AIDA, Costa, Cunard, and P&O Cruises (UK). The Cruise Support segment represents port destinations and private islands for the benefit of its cruise brands. The Tour and Other segment operates hotel and transportation operations of Holland America Princess Alaska Tours. The company was founded in 1972 and is headquartered in Miami, FL.