What happened
Shares of cruise company Carnival (CCL +1.06%) fell 2.9% by noon ET on Monday after the company confirmed that it will provide a first-quarter 2022 business update on Tuesday morning, following release of its first-quarter earnings report.
The update will be provided via webcast, and interested parties can sign up to listen here.
Image source: Getty Images.
So what
The business update announcement was the only really relevant news about Carnival today. Management did not warn that tomorrow's earnings news will be bad, either -- just confirmed the time and provided a link. Yet investors seem nervous nonetheless.
For what it's worth, expectations for Carnival in the first quarter are already pretty low. According to Yahoo! Finance, analysts are looking for the cruise giant to post an $0.89 per share loss on sales of only $2.3 billion.
Now what
But might the numbers be worse than that?
Recall that in December, Carnival told investors it thought huge pent-up demand for cruising would boost revenue and allow the company to raise prices in the first quarter. But last week, Truist Financial cited "conversations with senior executives at very large travel agencies," that suggested the opposite: Despite waning COVID-19 restrictions and infections, demand for cruises in the first half of 2022 looks weak, and this weakness could extend into the rest of this year.
Today's sellers might be bracing for Carnival to admit that it was over-optimistic three months ago, and that recovery will take a bit longer than anticipated. Investors can only hold their breath and cross their fingers, and hope that tomorrow's news won't be any worse than it's already expected to be.
