Analysis: What to Expect From Carnival's Third Quarter Report

Carnival Corp.'s pricing might be up but yields are down, says Robin Farley, UBS analyst, in anticipation of the firm's upcoming earnings report.  // Photo of Carnival Breeze by Susan J. Young

A UBS Investment Research analyst, Robin Farley, covers the cruise industry for her investors. On Friday, in advance of Carnival Corporation's third quarter earnings report on Tuesday, Sept. 23, she put out a note to those investors about potential results. 

Among the factoids of interest to agents? Here's a look. 

  • Carnival Corporation's Caribbean pricing could be up, but yields might be down due to lower occupancy.
  • European strength from Costa's recovery could drive the upside in the third quarter, based on high-season itineraries like Europe and Alaska.
  • Forty-four percent of the company's third quarter deployments were in Europe, 14 percent in Alaska.
  • Still, the Caribbean is sizable in the company's deployments -- some 27 percent for the third quarter.
  • "We believe the close-in Caribbean was challenging" for the third quarter. 
  • UBS sees fourth quarter yields for Carnival Corporation projected to be up 2 percent to 2.5 percent.
  • Notably, it believes the fourth quarter may constitute the first positive quarter of yield for Carnival Corporation since the first quarter of 2012.
  • The fourth quarter is also historically a period of good performance for the cruise stocks, heading into Wave Season.
  • "We note that Costa is likely to end up the best-performing brand in 2014.
  • "We think the Carnival [Cruise Lines] brand recovery is under way as well."
  • UBS Investment rates Carnival Corporation's stock a "buy." 

Stay tuned to for an update tomorrow after the company reports its third quarter 2014 earnings. 


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