CCL offers another 1 Billion in common stock :(

[strickerj]

One other thing - the linked Motley Fool article mentions that the fed hiking interest rates by 0.75% would increase the cruise industry's debt by $550M. Does that mean the loans are variable interest, or is it a hypothetical lifecycle cost where future refinancing is taken into account?

[DaveOKC]

1 minute ago, strickerj said:

I can understand that; I just wonder if overdoing it would cause hesitation to buy among potential investors, that is, dilute the stock more than the amount of stock issued. I wouldn't buy any of this round of stock if I thought they were going to do it again every quarter.

Of course doing it often would be a negative, but may be the only way they have to keep the company solvent.  Better than filing Chapter 11 to be sure.

PS - I am from near you, I even ran the Kroger store in Ypsi years ago!

 

[DaveOKC]

2 minutes ago, strickerj said:

One other thing - the linked Motley Fool article mentions that the fed hiking interest rates by 0.75% would increase the cruise industry's debt by $550M. Does that mean the loans are variable interest, or is it a hypothetical lifecycle cost where future refinancing is taken into account?

Hard to say for certain, but most long term debt (like bonds) is usually set at a fixed rate, so no immediate impact.

[BermudaBound2014]

11 minutes ago, strickerj said:

One other thing - the linked Motley Fool article mentions that the fed hiking interest rates by 0.75% would increase the cruise industry's debt by $550M. Does that mean the loans are variable interest, or is it a hypothetical lifecycle cost where future refinancing is taken into account?

 

I believe that 15 Billion (of the 38 Billion dollars in debt) are variable interest rates. Scary huh? 

 

PS: I'm close to both you and @DaveOKC 🙂 

[BermudaBound2014]

29 minutes ago, DaveOKC said:

Well, issuing stock is certainly less expensive than borrowing the same $1 billion....

 

AHH.... but don't forget, they borrowed 1 Billion a month ago.  Meaning they both borrowed and diluted in a very short time frame. 

 

https://www.bloomberg.com/news/articles/2020-07-14/carnival-visits-debt-markets-a-third-time-as-pandemic-rages-on#xj4y7vzkg

 

 

Edited July 27, 2022 by BermudaBound2014

[DaveOKC]

23 minutes ago, BermudaBound2014 said:

 

AHH.... but don't forget, they borrowed 1 Billion a month ago.  Meaning they both borrowed and diluted in a very short time frame. 

 

https://www.bloomberg.com/news/articles/2020-07-14/carnival-visits-debt-markets-a-third-time-as-pandemic-rages-on#xj4y7vzkg

 

 

Yes they did borrow and likely due to not being able to float a stock purchase.  Note that the stock sale was just AFTER the stock had a decent bounce from its lows to around $11 - smart timing IMO.

[BermudaBound2014]

2 minutes ago, DaveOKC said:

Yes they did borrow and likely due to not being able to float a stock purchase.  Note that the stock sale was just AFTER the stock had a decent bounce from its lows to around $11 - smart timing IMO.

 

Obviously I have less faith in the industry than you do. IMO, reaching $11 was a pump and dump on the news of the CDC. If not that, then at least timing manipulated. 

[DaveOKC]

Just now, BermudaBound2014 said:

 

Obviously I have less faith in the industry than you do. IMO, reaching $11 was a pump and dump on the news of the CDC. If not that, then at least timing manipulated. 

Time to sell when everyone else is buying!

[BermudaBound2014]

1 minute ago, DaveOKC said:

Time to sell when everyone else is buying!

 

I acquired 500 short positions of each of the big three just over a year ago. Currently sitting at over 70% profit. I've thought about clearing them, but sadly I think all three in the industry still have room to fall. 

[rkacruiser]

The Market liked all three of the cruise lines today in spite of what  the Fed did.  

[rkacruiser]

4 hours ago, gilboman said:

Arrivecan hadn't impeded travel based on volume and bookings though 

 

Oh?   Volume and bookings are much improved from what they were 1-2 years ago, but, neither are where they were pre-Covid.  

 

I have enjoyed every visit to Canada I have ever made throughout my life starting as a child.  I would like to do another one.  But, I am not going to jump through another hoop in order to be able to do so.  If I didn't need ArrivCan during my last visit, I ought not to need it now.  The process is totally unnecessary.  It's another example of some bureaucrat, this time a Canadian, devising something to justify keeping his/her job.  

[Guest ldtr]

4 hours ago, strickerj said:

One other thing - the linked Motley Fool article mentions that the fed hiking interest rates by 0.75% would increase the cruise industry's debt by $550M. Does that mean the loans are variable interest, or is it a hypothetical lifecycle cost where future refinancing is taken into account?

For CCL the data is in their 10Q about 3/5 of their debt is fixed about 2/5 is floating.  Have not looked at the other lines.  

 

 

[Guest ldtr]

26 minutes ago, rkacruiser said:

The Market liked all three of the cruise lines today in spite of what  the Fed did.  

The market liked just about everything today.  The market did not like CCL enough to get it even back to the level it was at 2 days ago.

[rkacruiser]

1 hour ago, ldtr said:

The market liked just about everything today.  The market did not like CCL enough to get it even back to the level it was at 2 days ago.

 

Yahoo Finance's web site showed a negative change in their short term (2-6 weeks) projection for the stock.  They had been consistently positive.  No change in their mid-term or long term expectations however.  (Mid-term was positive; long term was stable.)  

[LocoLoco1]

Always curious if a quick pop up from a very low price is simply a coupla ‘hit n run’ deep -pocket daytraders, and it signifies not much of anything fundamental

[iancal]

I do not put much stock in the daily market numbers.  Too many extraneous factors that can move those numbers up or down.  Unless of course something very significant occurs to any of the companies themselves.

 

 No doubt all of the cruise conglomerate leadership teams are trying to come up with positive public statements that will have the most positive impact on their respective stock prices.

 

The real touchstones will be the quarterly financials.  The P&L, the cash flow projections, balance sheet changes, etc.  Or any subsequent stock issuances or bond floats announcements.   The  insider trading reports which can sometimes be telling.

Edited July 28, 2022 by iancal

[BermudaBound2014]

RCL released today and while they beat expectations for this quarter, it seems they had to back off positive statements for the year (much like CCL did when they said they would hit profitability for 2Q22 and then revised that to be sometime in the second half 2023).  Servicing the debt is going to be very challenging for all three lines...

 

In May, the cruise company said it expected to return to net profit for the second half of the year.....

Royal Caribbean Group said it now expects a loss in the second half of the year, citing increases in fuel costs, interest rates and foreign-exchange rates.

 

 

[rkacruiser]

Personally, I think there is too much day trading going on that is influencing the prices for all of the cruise lines.  

 

 

[JesseLivermore]

On 7/27/2022 at 11:22 AM, BermudaBound2014 said:

 

I acquired 500 short positions of each of the big three just over a year ago. Currently sitting at over 70% profit. I've thought about clearing them, but sadly I think all three in the industry still have room to fall. 

 

I wonder if short positions get OBC 😉 

[BermudaBound2014]

15 hours ago, rkacruiser said:

Personally, I think there is too much day trading going on that is influencing the prices for all of the cruise lines.  

 

 

 

Now now, don't hate the player, hate the game :-).

 

IMO, Day traders aren't the problem. Market manipulation by the big guys makes things very sketchy, 

[iancal]

1 hour ago, BermudaBound2014 said:

 

Now now, don't hate the player, hate the game :-).

 

IMO, Day traders aren't the problem. Market manipulation by the big guys makes things very sketchy, 

The daily volumes tell the story.

 

[rkacruiser]

6 hours ago, iancal said:

The daily volumes tell the story.

 

 

How much of this volume is by what type of investors?  Is there a way to determine this?  

[BermudaBound2014]

Well at least we know Carnival isn't alone. RCL just offered up 900 Million in bonds. NCL will release this week. After the rah-rah I expect they will also be generating cash in the short term. 

 

Royal Caribbean Group said Monday it has commenced a private offering of $900 million of senior convertible bonds that mature in 2025. The company said it would grant the initial purchasers an option to purchase up to $135 million more in convertible bonds. "The purpose of the offering is to replace some of the existing near-term maturities of convertible bonds with new longer-term convertible bonds in a manner which is non-dilutive to shareholders as described below," said Naftali Holtz, Chief

[BermudaBound2014]

Quick edit- NcL postponed their release until the 9th. The market never looks kindly on this move. This is relevant to CcL stock because all 3 trade in sync. 

Edited August 1, 2022 by BermudaBound2014

[iancal]

54 minutes ago, BermudaBound2014 said:

Quick edit- NcL postponed their release until the 9th. The market never looks kindly on this move. This is relevant to CcL stock because all 3 trade in sync. 

Absolutely. 

 

The reaction is usually what is the problem?  Or...is there a problem?

 

Is there a disagreement with the independent CPA's over what the numbers should be or how the numbers are presented/reported?   Or is it to do with the notes to the financials?

 

Do they need more time to craft an announcement or to complete a significant financial deal?   

 

Or time to spread more  lipstick on a pig?

 

Could be none of the above, could be nothing.  But imaginations tend to race in an industry environment like currently exists. 

Edited August 1, 2022 by iancal