Carnival May Be Downgraded

[Denton_Geek]

http://www.usatoday.com/travel/cruises/item.aspx?type=blog&ak=65047903.blog

 

Looks like Moody's is getting kinda moody on Carnival.

[Wennfred]

Goes to show you how much those people know about anything, Carnival just increased their booking big time because of all of the RCI customers jumping ship. They will show a better 2nd Qty earnings.

 

Should always stay stable, the debt they see is from Carnival building ships, total idiots at Moody. Carnival is still sailing full so what do they know.

 

 

Fred

[jessemon]

Goes to show you how much those people know about anything, Carnival just increased their booking big time because of all of the RCI customers jumping ship. They will show a better 2nd Qty earnings.

 

Should always stay stable, the debt they see is from Carnival building ships, total idiots at Moody. Carnival is still sailing full so what do they know.

 

 

Fred

Alhough sailing full Carnival might not be getting as much onboard revenue.....Just a thought.....;)

[Wennfred]

If the company was strapped, would you think they would be building more ships? Carnival has 2 new ships coming out, not to mention the other lines like Hal, Costa, Cunard etc.

[Denton_Geek]

Carnival may be sailing full, but they've slashed prices to do so.

[tnsail]

These are some of the same clowns that stamped AAA on $200,000 mortgages to people that earn $30,000 a year.... These rating agencies need to be scraped.... Wheather CCL or RCCL are having lower earnings, how could you believe these fools????.....

[G'ma]

On the other hand:

 

From PRN/Newswire:

 

http://finance.yahoo.com/news/The-Wave-Rolls-On-Carnival-prnews-14530628.html

 

and:

 

http://www.rgj.com/article/20090325/BIZ04/903250417

 

Just examples of a responsible management and intelligent planning. Everyone is suffering in this rotten economy; some are doing better than others.

 

I have no doubt that Carnival Corp. will survive this in fine shape with all components intact.......

[MrSegway]

If the company was strapped, would you think they would be building more ships? Carnival has 2 new ships coming out, not to mention the other lines like Hal, Costa, Cunard etc.

 

Just realize the decision to build the ships that are coming our soon was made several years ago under economic times. Carnival may be slahing prices but at the cost of lower revenue and profits. I'm sure they are all being hit hard.

[Casino Player]

http://www.usatoday.com/travel/cruises/item.aspx?type=blog&ak=65047903.blog

 

Looks like Moody's is getting kinda moody on Carnival.

 

 

The Moody's rating acgency? The same Moody's that rated Freddy Mac and Fannie Mae with AAA on mortages to people who couldn't afford to pay them back? The same rating agency that didn't downgrade the same above agencies when they gave mortages to people who couldn't verify their income? Don't make me laugh.

[KCCruisin']

Surprised to see your Mean Green avatar! UNT, that's my Alum :)

[LADYBUG34113]

I don't buy the story either. Carnival is doing great right now due to their making cruising more affordable during the economic hard times.

 

There have been so many threads lately of RCCL passengers coming over to Carnival. Call Carnival and they will tell you they have been busy lately.

 

If anyone is hurting, it is RCCL and other lines that are charging way too much!

[*Mach*]

Alhough sailing full Carnival might not be getting as much onboard revenue.....Just a thought.....;)

 

 

They are sailing full and they are making a profit, not as great a profit as last year but they are still WELL in the black... something that many other cruise lines can't claim...

:)

[gtalum]

If the company was strapped, would you think they would be building more ships? Carnival has 2 new ships coming out, not to mention the other lines like Hal, Costa, Cunard etc.

 

While I doubt CCL is in any trouble, the fact that they're building ships is no sign of current performance. Just look at RCI and NCL. They're both doing markedly worse than CCL, and are both building massive new ships.

 

I suggest the recent downgrade (and any possible future downgrade) has more to do with the skittishness of the credit market than with any fundamentals of CCL's business performance.

[Denton_Geek]

Surprised to see your Mean Green avatar! UNT' date=' that's my Alum :)[/quote']

 

Awesome! Hope you can make a donation to the new football stadium! :)

[Pegs222]

Alhough sailing full Carnival might not be getting as much onboard revenue.....Just a thought.....;)

 

You forget that once they are on board they buy the drinks, excursions and gamble. That is where they make the money. Their profits may be down a bit, but they still sail full and that is more than some of the of lines can say.

[BND]

Surprised to see your Mean Green avatar! UNT' date=' that's my Alum :)[/quote']

 

Geez, my dad got his PhD in Chemistry from there in the late 60's and taught there while in grad school and I went to the lab school on campus from K-2nd grade before we moved to the DC area. Back when it was NTSU, not UNT.

 

I think Carnival is fine, but like everyone else, the "extra" cushion money has shrunk. Moody's is obviously not right all the time.

[Nezmo]

Carnival's ability to stay liquid is tied directly to people being able to afford to pay for the cruises. Employment issues will lag far behind the market recovery when it happens so while Carnival may still be doing okay now, it is still very possible that they will see a marked downturn in business in the years to come as people continue to loose their jobs even when the economy in general picks up.

 

Sure, Carnival is strong now but I really think people need to see the longer term picture.

[Nunu]

It's not such a negative thing and I'm glad that lenders are deciding to finally start being conservative with their views after the free for all of the last few years caused the madness that we're in now.

[DqALEX]

I feel its what I call the snowball effect. As you keep cutting prices to fill the ships you start to cater to a whole different class of people that don't have the money to buy as many photo's that are not cheep, drinks that are not cheep, and tours that are not cheep. This may come back to bite Carnival. Now next if they have to start to cut, service to make up for full ships that don't gross the money look out. My last cruise I felt like a Hollywood actor. At dinner time there are so many people want to take my picture now with so many backdrops its hard to walk down the hall. I do agree the profit is not in the cruise ticket, its in everything else. If you can get on a cruise ship for under $100 a day that takes you from point A to Point B, food and cabin you are way ahead of the game. What you would pay for air alone is more than $100.

[Denton_Geek]

Geez, my dad got his PhD in Chemistry from there in the late 60's and taught there while in grad school and I went to the lab school on campus from K-2nd grade before we moved to the DC area. Back when it was NTSU, not UNT.

 

Awesome to meet some UNT connections.

 

Carnival's credit rating really isn't that big of a deal. Like others have pointed out, this is related more to the credit market - kind of like how it's harder for all of us to qualify for a car loan or home mortgage.

[Nezmo]

Awesome to meet some UNT connections.

 

Carnival's credit rating really isn't that big of a deal. Like others have pointed out, this is related more to the credit market - kind of like how it's harder for all of us to qualify for a car loan or home mortgage.

Agreed but it still all ties back to a generally lower view of future business.

[dmfriedman]

Goes to show you how much those people know about anything, Carnival just increased their booking big time because of all of the RCI customers jumping ship. They will show a better 2nd Qty earnings.

That's funny, because I'm pretty sure that last Thursday, Carnival filed paperwork with the SEC to indicate that they were expecting lower 2nd quarter earnings. Something tells me that it may just be those people who know something, and those same people whose information Moody's was basing their outlook change on. :)

 

http://www.reuters.com/article/marketsNews/idINN0333732120090403?rpc=44

 

http://biz.yahoo.com/e/090402/ccl10-q.html

[BND]

That's funny, because I'm pretty sure that last Thursday, Carnival filed paperwork with the SEC to indicate that they were expecting lower 2nd quarter earnings. Something tells me that it may just be those people who know something, and those same people whose information Moody's was basing their outlook change on. :)

 

http://www.reuters.com/article/marketsNews/idINN0333732120090403?rpc=44

 

http://biz.yahoo.com/e/090402/ccl10-q.html

 

I think that indicates lower incomes because of lower prices, not because of less bookings. I guess part of it is where we live and the types of jobs we have, but everyone I know is still traveling and spending the way they have for years. I do think Moody's is fickle when it comes to ratings though.

[Nunu]

That's funny, because I'm pretty sure that last Thursday, Carnival filed paperwork with the SEC to indicate that they were expecting lower 2nd quarter earnings. Something tells me that it may just be those people who know something, and those same people whose information Moody's was basing their outlook change on. :)

 

http://www.reuters.com/article/marketsNews/idINN0333732120090403?rpc=44

 

http://biz.yahoo.com/e/090402/ccl10-q.html

 

Are you saying that Moody's doesn't monitor these boards and notice the 10 threads showing RCI customers that are defecting to Carnival?

[Silverscreencruiser]

You forget that once they are on board they buy the drinks, excursions and gamble. That is where they make the money. Their profits may be down a bit, but they still sail full and that is more than some of the of lines can say.

 

As casinos have found out over the years, the trick is to get people in the door (or onboard). Very few people have the discipline on a vacation to limit themselves to just the minimum costs. People are cutting back, but Carnival is getting the people who were spending hundreds more on an RCI or NCL cruise and who can splurge somewhat on Carnival and still come out ahead.