Carnival (NYSE:CCL), the largest cruise ship operator in the world, generally isn't considered a top income-generating stock. However, its 2.4% yield is actually higher than Royal Caribbean's (NYSE:RCL) 1.75% yield and the S&P 500's 2.3% yield.

In a previous article, I discussed Carnival's core strengths and weaknesses as a long-term investment. Today, I'll focus on whether or not the company will raise its dividend in 2016.

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Source: Carnival.

Payout ratios and dividend history
During the past 12 months, Carnival and Royal Caribbean have both paid out 37% of their free cash flows as dividends. On an EPS basis, Carnival and Royal Caribbean respectively paid out 53% and 50% of their earnings per share as dividends. While this looks like Carnival is slightly more generous, it also means that Royal Caribbean has a little more room to raise its dividend.

Carnival's dividend hikes haven't been consistent. The company suspended its dividend for a year in 2009. It reintroduced a $0.10 quarterly dividend in late 2010, and raised it to $0.25 in 2011; but the company didn't hike it again until last year, when it reached $0.30.

Because that history of dividend hikes is uneven, we should compare Carnival's payout ratio to its projected earnings growth to see if a dividend hike is in the cards. Analysts, on average, expect Carnival to grow its EPS 24% annually, to $3.36 in fiscal 2016, which started last December. Assuming that Carnival keeps its payout ratio at 50%, it might eventually raise its quarterly dividend 40%, to $0.42 per share.

However, Carnival has only paid its $0.30 dividend twice, so it could stick with that payout for at least two more quarters, indicating that a potential hike might come in late 2016 or early 2017. Assuming that Carnival stock is still worth around $50, the hike would push its forward yield over 3%.

Bottom line tailwinds and headwinds
Carnival's future dividend hikes are highly dependent on its bottom-line growth. Fortunately for investors, Carnival's earnings have recently been lifted by lower fuel costs. During its fourth quarter, its fuel costs fell 46% annually, thanks to lower oil prices and hedging strategies. That big decline, along with lower payroll and operating costs, helped Carnival generate a net profit of $270 million -- up from a loss of $104 million a year earlier. Its operating cash flow rose 53.5%, to $978 million.

However, Carnival also faces three main challenges in the coming year. First, currency exchange rates already knocked $0.08 of its earnings per share last quarter. Looking ahead, any further weakness in the euro, pound, Australian dollar, and Canadian dollar against the dollar will impact its bottom-line growth.

Second, its growing dependence on China, where it recently added a fourth ship and signed two new joint ventures, could backfire if the Chinese economy continues to slow down and the RMB falls. On the bright side, Carnival isn't highly exposed to Latin America, a deeply troubled market that cost Royal Caribbean nearly $400 million last quarter.

Lastly, Carnival has more trouble growing its ticket revenues than Royal Caribbean. Last quarter, Carnival's passenger ticket sales fell 1.3%, partially due to currency impacts, while Royal's ticket sales rose 4.9%. Onboard revenues rose at both companies, but they failed to prevent Carnival's revenue from dipping 0.3% annually.

All of these factors could impact Carnival's top- and bottom-line growth, and throttle its ability to raise its dividend. A decline in earnings growth could also cause investors to focus more on Carnival's lackluster sales, which are only expected to rise 4% in fiscal 2016.

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Source: Carnival.

Verdict: Don't hold your breath
Carnival pays a decent dividend today, but investors shouldn't expect the company to raise its dividend in 2016. The company's unreliable record of dividend hikes indicates that it could be stuck at $0.30 for a few more quarters. However, if oil prices remain low and currency headwinds subside, its earnings growth might justify a dividend hike by the end of the year.

Leo Sun has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.