What happened

Typically, when an analyst raises a price target on a stock, it gets a nice lift on the day. That wasn't happening with struggling cruise ship operator Carnival (NYSE:CCL)(NYSE:CUK) on Friday, though. The company continues to be the victim of gloomy investor sentiment.

So what

Truist Securities was the entity shifting its price target. The investment bank now believes Carnival is worth $20 per share, up from the previous estimation of $18. That doesn't change Truist's overall outlook on the shares, though, as it's leaving unchanged its sell recommendation. It's little wonder -- that $20 per share level is below the $22.71 Thursday closing price of Carnival's stock.

An empty deck on a cruise ship.

Image source: Getty Images.

It wasn't immediately apparent why Truist upgraded its price target. It might have had something to do with Carnival's announcement earlier this week that it expects to operate its fleet at up to 75% of capacity by the end of this year.

That's an enormous improvement over the 0% during the thick of the pandemic, but it's not necessarily heartening for investors who were banking on a roaring comeback for the travel and tourism sector this year.

Now what

Meanwhile, Carnival is locked in a legal battle with the government of Florida over the state's prohibition on requiring proof of vaccination from customers. As the company intends to operate cruises with 100% vaccination rates, the ban really hobbles its efforts. Carnival has done a good job so far surviving the pandemic, but its sailing will be anything but smooth as it cruises toward recovery.

 
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.