What happened
Shares of cruise line operator Carnival Corporation (CCL 1.49%) (CUK 1.34%) fell 2.6% on Monday, which may not seem like very much. However, the S&P 500 was up roughly 2.6% today, meaning Carnival underperformed by a significant margin. And it underperformed because the stock received bearish comments from Wall Street this morning.
So what
According to The Fly, analysts Brandt Montour, Benjamin Chaiken, and Christopher Stathoulopoulos -- of Barclays, Credit Suisse, and Susquehanna, respectively -- all lowered their price targets for Carnival this morning. Montour's price target is down 29% to $10 per share. Chaiken's is down 24% to $22 per share. And Stathoulopoulos' is down 33% to $8 per share.
Interestingly enough, all three price targets are higher than where Carnival stock traded as of the market's close on Monday, suggesting 17% upside to more than 200% upside. And indeed, counter to what you'd expect from today's underperformance, two of these three analysts still believe Carnival is a stock worth buying right now.
Now what
Today's price targets from analysts are simply delayed reactions to when Carnival reported financial results for the third quarter of 2022 on Sept. 30 -- many analysts gave their thoughts that day, whereas this trio took the weekend to process the news.
However, one of the reasons some remain bullish on Carnival stock comes from its Q3 report. While Q3 results are still challenged, management noted that bookings for future cruises are surging past its pre-pandemic results of 2019. For context, the company recently relaxed its policies for controlling the spread of the coronavirus on its cruises. And it seems that people are more eager to sail under those relaxed conditions.
Carnival does still a have a long way to go to undo the damage the pandemic did to its business. But the strong bookings do point toward light at the end of the tunnel.
