Stock in Focus: Carnival

Cruise operator Carnival is perfectly positioned to profit from an ageing population as changing demographics drive revenues

Jaime M. Katz, CFA 28 June, 2018 | 10:41AM
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Cruise operator Carnival ageing population profit

Carnival (CCL) is the largest company in the cruise industry, operating 10 global brands with more than 100 ships in service and passenger capacity of more than 200,000, allowing it to reach a diverse group of consumers in a lightly penetrated vacation segment. Efficient scale, the lowest unit costs in the industry, and intangible brand assets provide the company with a narrow economic moat.

Carnival's market is underpenetrated, with less than 4% of the domestic market ever having cruised. With low domestic penetration rates and even lower international recognition, less than 3% in Europe, upside potential remains significant.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Carnival PLC1,460.40 GBX-2.05Rating

About Author

Jaime M. Katz, CFA  is an equity analyst for Morningstar, covering leisure and travel and retail.