Carnival Stock Below $10

[Ptroxx]

1 hour ago, BlerkOne said:

There really isn't a form for Carnival. Princess really does have a form they want 

 

Edited August 17, 2022 by Ptroxx

[BlerkOne]

I see Carnival has pushed out a chunk of debt by a year at no increase in interest (still 5.75% - a bargain).

 

https://www.carnivalcorp.com/news-releases/news-release-details/carnival-corporation-plc-announces-extension-maturity-339

 

 

[At Sea At Peace]

8 hours ago, BlerkOne said:

I see Carnival has pushed out a chunk of debt by a year at no increase in interest (still 5.75% - a bargain).

 

https://www.carnivalcorp.com/news-releases/news-release-details/carnival-corporation-plc-announces-extension-maturity-339

 

 

 

Well, honestly, this is no "chunk" of debt.  It is $339M or less than 1% of its outstanding debt.  It actually is embarrassing that they were only able to convince 65% of the debtholders to do it as $183M of other debtholders didn't buy into the deal and remain due on original schedule.

 

Seriously, this is a dire disclosure in that it, the transaction, is so small, with such secured, senior convertible notes, that they even would waste the legal and professional fees to do it.  Seriously.  And no, not every little bit helps.  

 

The do need "chunks" of debt to be refinanced.  The market is pricing such as junk and at essentially twice this rate.  Subsequent debt trades have affirmed the junk (high yield is the PC today) status.

 

They clearly cannot generate the cash flow and earnings to make their existing debt maturity obligations.  They, and RCL and NCL, are in a "liquidity squeeze" for the foreseeable future.

[At Sea At Peace]

1 hour ago, At Sea At Peace said:

 

Seriously, this is a dire disclosure in that it, the transaction, is so small, with such secured, senior convertible notes, that they even would waste the legal and professional fees to do it.  Seriously.  And no, not every little bit helps.  

 

 

Just wanted to add a bit of "debt side" commentary on this.  IMO, this is where and who controls the story of how this unwinds and plays out.

 

These notes were a tranche in a larger $1.75B issuance @ 5.75%.  These particular notes are so high priority secured they were initially and regularly trading early at 250% of FACE (massive negative yield) last year.  For vultures, it was the security (see below image).

 

These are now trading at 125%, or HALF, of issuance value just last year!

 

 

 

[ontheweb]

23 hours ago, Illbcruzn4life said:

The way today is going there might not be a need for that. NCL is dragging the rest of the cruise stocks down I guess

Aren't stocks in general, not just cruise stock, going down after several days of going up?

[BlerkOne]

3 hours ago, At Sea At Peace said:

 

 

Seriously, this is a dire disclosure in that it, the transaction, is so small, with such secured, senior convertible notes, that they even would waste the legal and professional fees to do it.  Seriously.  And no, not every little bit helps.  

 

 

It would be illegal for a company not to disclose material events.

 

It absolutely helps to push short term debt of any amount out until the company is profitable again.

[At Sea At Peace]

4 minutes ago, BlerkOne said:

It would be illegal for a company not to disclose material events.

 

It absolutely helps to push short term debt of any amount out until the company is profitable again.

 

Of course they have to disclose.   That was not the point at all.

 

The comment was regarding the waste of legal and professional fees to "do it" i.e., the refinancing (not the required legal and professional fees once something has been done, which are not cheap, and they are required to file such disclosures thereafter; which are template minimal).

 

Hope that helps the perspective of the comment.

 

NP

[BlerkOne]

10 minutes ago, At Sea At Peace said:

 

Of course they have to disclose.   That was not the point at all.

 

The comment was regarding the waste of legal and professional fees to "do it" i.e., the refinancing (not the required legal and professional fees once something has been done, which are not cheap, and they are required to file such disclosures thereafter; which are template minimal).

 

Hope that helps the perspective of the comment.

 

NP

Carnival has a herd of attorneys on staff. Better to have them doing something other than playing solitaire.

 

I think it should be obvious this is not the end of the pushing out of short term debt while some gets repaid from new debt.

[zentraveler]

56 minutes ago, BlerkOne said:

Carnival has a herd of attorneys on staff. Better to have them doing something other than playing solitaire.

 

I think it should be obvious this is not the end of the pushing out of short term debt while some gets repaid from new debt.

Fascinating discussion AtSeaAtPeace and BlerkOne. Don't completely understand all of it, but so appreciate those of you who do educating us. I bought it back when it had been steady in the $50's (really for the OBC and its seeming stability - ha!) and have been contemplating the idea of buying low to salvage something of my loss. Really interesting reading.

[Arizona Sunshine]

20 hours ago, zentraveler said:

have been contemplating the idea of buying low to salvage something of my loss. 

Respectfully, the best way to salvage something of your loss is to invest in a better company with a brighter future. 

 

AS

[Lee Cruiser]

On 8/16/2022 at 9:43 PM, Joe817 said:

• IMHO, The stock broke the $10.00 psychological barrier, and it closed today at $11.19, a gain of 4.48%.  

Unfortunately it didn't stay there long.  Back down below again today.  Hopefully, it will just be a short drop and then go back up again.

[Tom-n-Cheryl]

Getting whiplash 🙂

 

Are other sectors this volatile on a daily/weekly basis?

 

Tom

[mz-s]

12 minutes ago, Tom-n-Cheryl said:

Getting whiplash 🙂

 

Are other sectors this volatile on a daily/weekly basis?

 

Tom

 

In a recession, yes.

[Lee Cruiser]

20 minutes ago, Tom-n-Cheryl said:

Getting whiplash 🙂

 

Are other sectors this volatile on a daily/weekly basis?

 

Tom

Yes, but most not quite as much.  I have about 20 stocks in my general trade account.  Carnival is by far the most volatile.  At this moment it is down 5.45% today, while others are only down under 2% and one is actually up slightly today.  If it were not for the onboard credit, I would not have bought Carnival because it does tend to cause whiplash.

Edited August 19, 2022 by Lee Cruiser

[BlerkOne]

1 hour ago, Lee Cruiser said:

Unfortunately it didn't stay there long.  Back down below again today.  Hopefully, it will just be a short drop and then go back up again.

The Royal effect.

[Tom-n-Cheryl]

Speaking of stocks - I saw the following headline today and thought this kid stuck it rich:

 

Student, 20, makes $110 million trading meme stock Bed Bath & Beyond

 

Then I read this part  🙄  : He bought 4.96 million shares at $5.50 each through a Wyoming-based holding company he set up.

 

Which drives this home: It takes money to make money !!

 

Tom

[JT1962]

3 hours ago, Tom-n-Cheryl said:

 

Are other sectors this volatile on a daily/weekly basis?

 

Tom

Stocks are given a volatility score called a Beta. The S&P 500 index has a Beta of 1. Carnival currently has a Beta of 2.09, meaning it will generally move up or down twice as much as the overall market. So if the market goes up 1%, Carnival is likely to go up 2%, or vice versa when the overall market drops.

 

Of course news related specifically to Carnival, cruises or travel in general will have more of an effect.

 

https://www.zacks.com/stock/chart/CCL/fundamental/beta?TSPD_101_R0=08d01cef9bab20003402f40e58cfa24cdfe2494b3bf45a7ced49caa998e99285fa6e9334c4862e060865cec0f714300004eb94d7459bcdc2c5af6c91b398197df7df168891726c2cc4eac711f50bae18e6a4be0dc72dec4366b1bbf219554921

[At Sea At Peace]

Well, the thread title was aptly to the proffer of "CCL under $10" at the time.  I guess it's appropriate to keep it as we might see decrements such as under $9?  Got real close today. 

 

Worse, across the board wake up call for the 'end of summer stock market reality check, mortgage rates halting the real estate bubble, inflation not solved by the IRA 🙄 and costs of living still influential, a growing unreliable air transportation system that mocks supply chain issues for goods, back to school from K through colleges ready to meet BA.5 fallout, and, worst of all, the drums beating for the season of the MT elections.

 

Yuck.

[PUNKT2]

Yet according to Jefferies bookings continue to come in with pricing remaining strong amidst growing yields - go figure!

[lostsoulcruiser]

Stock at $10.50 at this writing based on strong future bookings.  Prices of cruises are up also.  My present booking for a balcony on the Glory (4-16-23) is now $80 per person higher than when I secured the booking.  

With the trend towards relaxation of COVID restrictions (increased passenger capacity), higher prices, and increased on-board spending cruises lines should begin to return to profitability.  Doubtful they will return to pre-Covid prices due to the heavy debt load needed to survive.  Increasing interest rates will impact the refinancing of their present debt and could impact future profitability.

 

[PUNKT2]

For sure. Just given the dilution with all the extra shares issued, the three cruise companies would be doing well to get their stock prices back to half of where they were three years ago in the next year or two. 

[Tom-n-Cheryl]

1 hour ago, PUNKT2 said:

For sure. Just given the dilution with all the extra shares issued, the three cruise companies would be doing well to get their stock prices back to half of where they were three years ago in the next year or two. 

 

I'd be OK with that. Everything beyond $18 puts me in the black.

 

Tom

[gkbiiii]

The current stock price is $9.16 as of 9/29/22, what is the long/short term viability for this company?

[Mary229]

People often equate stock price with financial strength, it is not true.  The stock price is only a gauge of sentiment based on underlying fundamental analysis.  It does not necessarily predict their viability, actually it doesn’t predict anything. 

Edited September 29, 2022 by Mary229

[Tom-n-Cheryl]

23 minutes ago, gkbiiii said:

The current stock price is $9.16 as of 9/29/22, what is the long/short term viability for this company?

No idea, but I hear that Carnival might turn a profit in the third quarter of '23