Why Carnival Corp. Stock Sank by Almost 11% in January
Shares of cruise ship company Carnival Corp. (NYSE: CCL) sank by 10.6% in January, according to data provided by S&P Global Market Intelligence. Other cruise and travel stocks performed comparably during most of the month. However, Carnival stock dropped more than its peers later in the month, signaling something specific to the company.
The market was potentially downbeat about a couple of factors. First, Carnival owns the Princess Cruises brand and its new largest ship, the Sun Princess, was scheduled to set sail in February. However, the ship won't be ready in time, forcing Carnival to reschedule and offer refunds and travel credits to those who had already bought tickets.
Additionally, geopolitical turmoil in the Red Sea is forcing Carnival and other cruise lines to reroute cruises that were scheduled to pass through there. For Carnival, this meant rerouting 12 ships, which is more than some of its rivals. Unfortunately, there's a real cost to doing this -- management expects this will reduce its adjusted earnings per share (EPS) by $0.07 to $0.08 for the quarter.
Source Fool.com
Carnival plc Stock
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