Carnival Share Price: Is CCL a Good Long-Term Buy?

The Carnival share price has made a swift recovery even after the firm recorded a big £2 billion loss in the fourth quarter. The CCL stock is trading at 1,460p, which is about 30% above the lowest level in December.

Carnival, like all cruise stocks have done well in the past few weeks as investors hope that the firms will recover this year. The Norwegian stock price has risen by 9% in the past 30 days while Royal Caribbean shares have jumped by over 16% in the same period.

Investors believe that there will be more demand for cruises as more countries reopen. Besides, while the number of Omicron cases have risen, data suggests that the disease is not leading to serious illness. And most patients are not being hospitalized.

Therefore, after spending about 2 years indoors, many people will likely embrace cruising and other activities.

Still, Carnival’s management have a lot to do. For one, the company is still burning about £500 million every month and its debt has risen to over £28 billion. Before Covid, the company had about £11 billion in debt.

At the same time, the company is still operating below capacity. The latest data showed that it is operating at about 61% capacity. Therefore, the firm will need to deal with closer regulatory scrutiny and a gradual return to normalcy.

Carnival share price forecast

The four-hour chart shows that the CCL share price has been in a tight range lately. The stock is trading at 1,460p, which is slightly above the lower side of the channel. It is also along the 50% Fibonacci retracement level. Also, the shares are along the 25-day moving average.

A closer look at the channel shows that it is broadening. This is a bullish signal, which means that gains could remain in the short term. In the long-term, Carnival’s management has a lot to prove since a significant chunk of money will go to servicing debt.

carnival share price