What happened
Like the business itself, shares of cruise operator Carnival (CCL 1.58%) continue to have trouble recovering from the pandemic. Carnival stock is down 23% over the past year as the cruise industry has had fits and starts trying to rebound from pandemic impacts. Today, investors are giving it the thumbs-up for several reasons. Carnival shares rose as much as 5% on Tuesday before settling to a gain of 3.5% as of 2:43 p.m. ET.
So what
Today's optimism came a week after the company reported a disappointing first-quarter 2022 business update. But with potential signs of progress in peace talks between Russia and Ukraine, along with falling oil prices, the cruise business might be facing fewer headwinds.
Image source: Getty Images.
Now what
Carnival reported a net loss of $1.9 billion for its fiscal first quarter, ended Feb. 28, on disappointing total revenue of $1.62 billion. Analysts had expected revenue to reach almost $2.3 billion. The company told investors that "the increased uncertainty given the current invasion of Ukraine, including its effect on the price of fuel," is having a material impact on its business.
Today, oil prices are dropping as Reuters reports that there are signs of progress in peace talks being held in Turkey between Russia and Ukraine. Last week the company said that booking deposits continued to rise in the most recent quarter. It also said it expects to have each of its brands' entire fleets in operation for the important summer sailing season.
Relief in fuel prices along with the potential for the Russia-Ukraine conflict to be nearing an end have investors bidding Carnival shares back up today.
