Carnival Corporation’s (NYSE:CCL) Outlook is Improving. Should You Buy?

Carnival Corporation’s (NYSE:CCL) Outlook is Improving. Should You Buy?

Even after adjusting for the dilutive effect of future cruise credits offered to customers whose itineraries were affected due to mobility restrictions in 2020, Carnival reported a 0.5% increase in revenue per passenger cruise day in Q4, which is another promising development.

Occupancy in the recent quarter was 19% below 2019 levels, which is an indication that Carnival still has a long way to go to fully recover from the blow dealt by the pandemic. On the bright side, occupancy in Q3 was 29% below comparable levels in 2019, which highlights that Carnival’s occupancy rates are improving with every quarter.

To assess the short-term outlook for a cruise operator, investors can evaluate the level of customer deposits as these deposits are placed when booking a vacation. Carnival’s total customer deposits eclipsed $5.1 billion in the fourth quarter, marking a record high for Q4. Cumulative advanced bookings for 2023 are above 2019 levels at higher prices, which is a confirmation that demand for cruises is coming back strongly.