• Every forecast points to an earnings per share (EPS) of $0.06 and around $5.93 billion in revenue.
• The company aims for $3 billion in free cash flow for fiscal year 2024, maintaining a debt-to-equity ratio of 3.38.
• Future bookings for 2025 exhibit an increase of 10-15% above historical averages, suggesting a promising financial horizon.

Carnival Corporation & plc stands tall in the cruise industry, offering diverse vacation options across its expansive fleet. As it prepares to unveil its quarterly earnings on December 20, 2024, market analysts are closely monitoring its financial performance. Wall Street expects an earnings per share (EPS) of $0.06 with a projected revenue of approximately $5.93 billion.

Investors are keen to dig deeper than just these top-line figures to evaluate Carnival’s financial solidity and operational efficiency. The cruise giant anticipates generating $3 billion in free cash flow for the fiscal year 2024, despite facing high capital expenditures. This cash flow is critical for decreasing its debt, underscored by a debt-to-equity ratio of 3.38, which shows a significant reliance on debt financing.

Carnival is poised to capitalize on robust demand for cruises in 2025, as bookings surge by 10-15% beyond historical averages. This increased demand is expected to bolster the company’s financial performance, ultimately aiding in free cash flow generation and aiming for $6 billion in adjusted EBITDA.

The stock price of Carnival has demonstrated considerable growth, buoyed by even better-than-anticipated Q3 2024 results and optimistic full-year forecasts. While Q4 2024 results may not match expectations, overall outcomes for 2024 and the bright outlook for 2025 are likely to mitigate any concerns. The forward price-to-earnings ratio for 2025 suggests a fair valuation of the stock, alleviating worries about potential overvaluation.

Examining financial ratios provides additional insights into Carnival’s valuation and stability. A price-to-earnings ratio of 20.09 and a price-to-sales ratio of 1.27 indicates that investors are paying $1.27 for every dollar of sales. Furthermore, the enterprise value to sales ratio of 2.45 and an enterprise value to operating cash flow ratio of 10.09 reflect the company’s total valuation in relation to its sales and cash flow. However, a current ratio of 0.30 signals potential liquidity challenges concerning short-term liabilities.