Carnival Corporation (CCL) Hits Fresh High: Is There Still Room to Run?

Shares of Carnival (CCL) have been strong performers lately, with the stock up 18.6% over the past month. The stock hit a new 52-week high of $22.39 in the previous session. Carnival has gained 18.2% since the start of the year compared to the 5.3% move for the Zacks Consumer Discretionary sector and the 12.9% return for the Zacks Leisure and Recreation Services industry.What's Driving the Outperformance?The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on September 30, 2024, Carnival reported EPS of $1.27 versus consensus estimate of $1.17 while it beat the consensus revenue estimate by 1.04%.For the current fiscal year, Carnival is expected to post earnings of $1.31 per share on $25.19 billion in revenues. Meanwhile, for the next fiscal year, the company is expected to earn $1.66 per share on $26.07 billion in revenues. This represents a year-over-year change of 26.69% and 3.51%, respectively.Valuation MetricsCarnival may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.Carnival has a Value Score of A. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of A.In terms of its value breakdown, the stock currently trades at 16.7X current fiscal year EPS estimates, which is not in-line with the peer industry average of 19.6X. On a trailing cash flow basis, the stock currently trades at 9.7X versus its peer group's average of 9.6X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.Zacks RankWe also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Carnival currently has a Zacks Rank of #1 (Strong Buy) thanks to rising earnings estimates.Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Carnival meets the list of requirements. Thus, it seems as though Carnival shares could have potential in the weeks and months to come.How Does CCL Stack Up to the Competition?Shares of CCL have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Norwegian Cruise Line Holdings Ltd. (NCLH). NCLH has a Zacks Rank of # 1 (Strong Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of B.Earnings were strong last quarter. Norwegian Cruise Line Holdings Ltd. beat our consensus estimate by 17.65%, and for the current fiscal year, NCLH is expected to post earnings of $1.59 per share on revenue of $9.4 billion.Shares of Norwegian Cruise Line Holdings Ltd. have gained 16% over the past month, and currently trade at a forward P/E of 14.97X and a P/CF of 9.53X.The Leisure and Recreation Services industry is in the top 41% of all the industries we have in our universe, so it looks like there are some nice tailwinds for CCL and NCLH, even beyond their own solid fundamental situation.Research Chief Names "Single Best Pick to Double"From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.Free: See Our Top Stock And 4 Runners UpWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Carnival Corporation (CCL): Free Stock Analysis Report Norwegian Cruise Line Holdings Ltd. (NCLH): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks