Carnival Stock Price Dropping

[Daniel A]

3 hours ago, AL3XCruise said:

Of course there are more individuals; but how much does that matter?  87% of the stock is held by institutions, meaning they own the vast majority of the company.  While the remaining stock holders aren't inconsequential, I think we all know who has the board's ear.  How exactly that plays out, though, none of us can say at the moment.  

I'm not arguing with you but I am interested in your thoughts on why you think CCL even gives the OBC across all of it's lines if it isn't to keep the small investors?  Wouldn't not offering the OBC increase the amount of profit going to the 87%?

[ed01106]

9 minutes ago, Daniel A said:

I'm not arguing with you but I am interested in your thoughts on why you think CCL even gives the OBC across all of it's lines if it isn't to keep the small investors?  Wouldn't not offering the OBC increase the amount of profit going to the 87%?

The real value in offering the OBC is not to encourage cruisers to buy stock but to encourage more cruising.  The type of person who has enough free cash to buy 100 shares of stock is a good customer for the line.  (e.g able to afford balcony rather than inside cabin, spend money at speciality dinning, spa etc) Plus it builds loyalty.  If you have stock in CCL but not RCL or NCL. you are going to be more loyal to CCL than you would otherwise.  Also shareholders are more likely to do marketing for the line than non-shareholders (a phenomena you can witness regularly here on CC) 

 

The purpose isn’t to keep small investors, it is to keep cruisers.  Hypothetically if CCL discontinued the OBC benefit the biggest problem wouldn’t be those small investors selling the stock....but them selling the stock then using the money to buy 100 shares of NCLH and sailing on NCL instead and the resulting loss of revenue from not having those customers anymore.   

[AL3XCruise]

24 minutes ago, Daniel A said:

I'm not arguing with you but I am interested in your thoughts on why you think CCL even gives the OBC across all of it's lines if it isn't to keep the small investors?  Wouldn't not offering the OBC increase the amount of profit going to the 87%?

A fair question.  As careless and ed01106 mentioned, there is a marketing/loyalty component to it.  There are half a billion or so shares of CCL outstanding, so investors buying 100 shares at a time are unlikely to make a big dent.  But if you keep those folks coming back onboard by offering an added incentive, it is a win for the bigger investors as well.

 

I'm sure CCL periodically reviews what the OBC benefits cost, what it brings in (in terms of both investment and business), and how that compares to other options.  Reading CC threads about the OBC benefit it certainly sounds like people are spending a lot of money with Carnival.

[Daniel A]

37 minutes ago, CarelessAndConfused said:

If we assumed that there were 1 MILLION CCL shareholders who cruise and further assume a stock price of $50, which it was above and below prior to the corona virus, you'd have $50 million tied up in OBC shareholders on a $30 BILLION + market cap company.  Meaning it would be about 1/6th or so of 1 measly percent. 

Check your math.  1,000,000 stockholders at $50/share = $50,000,000. Multiply that by the required minimum of 100 shares/stockholder equals $5,000,000,000.  That is 1/6th of the total of $30 Billion in your example, not 1/6 of one percent.

 

The whole point that was being made earlier was not the about effect the small OBC oriented investor has on the overall value of the CCL stock.  The point that was being made was that the bulk of the small investors here (on CC) aren't buying to do day trading on the hour by hour stock price but they are buying to hold over time so they can get the OBC benefit.  The point was if you're into the stock so you can get OBC over the next few years you aren't losing any money at all if you aren't selling off your stock.

[chipmaster]

Carnival is a slow cyclic stock that will rise and fall slowly lagging the macro for rising and as we all see falling faster and harder depending on what drives the down cycle.  One couldn't dream of a worse confluence of factors to create a perfect storm for airline and cruise, even 9/11 didn't impact them the same IMHO..  

 

Even with the crazy high yield, unless you have a very long time horizon I'd say capital appreciation will lag the larger macro economics.  

[johnatsis]

Carnival is the largest company in the cruise industry with nine brands and 100 ships and can weather this storm.  I have owned CCL for many years, I have bought and sold a lot of CCL stock and made a lot of money with them - I plan to buy a bunch next week when the dust settles... Also; Several analysts are forecasting a $56 share price in 2021 when yields and costs return to normal. 

 

[chipmaster]

9 minutes ago, CarelessAndConfused said:

 

 

While I definitely share many of your concerns, and agree it is not necessarily a "buy and hold" stock per se, except for the shareholder OBC crowd and/or the dividend hungry crowd, I do think if they escape bankruptcy (which is probably more likely than not but by no means a given), it will prop back up aggressively over a relatively short period of time.  At what level the bottom is and how much it will go up, I couldn't say.  I'd guess the low on it will be high teens/low 20s and will come back into the 30s later this year, unless the virus situation gets really bad in which case we'll all need to worry about a LOT more stocks than CCL.

 

 

 

Pick any stock at the moment, I'd not want to guess how low it can go.    The stock market isn't ruled by investors, most of the movement on a daily and all the momentum is huge funds doing high speed trading, the investors and buy and hold or yield / value seekers don't materially move the market or even provide floors to prices.    

 

Rich get richer, and investors need to now what the rules are in the market, LOL

 

I got all out around January 18th, lots of things look interesting but take the Biden bounce, the irrational reaction to each set of new news, it got a long ways to go to have any return to a normal state where value and guessing what the guessers are guessing becomes the norm. 

[Farts]

2 minutes ago, johnatsis said:

Carnival is the largest company in the cruise industry with nine brands and 100 ships and can weather this storm.  I have owned CCL for many years, I have bought and sold a lot of CCL stock and made a lot of money with them - I plan to buy a bunch next week when the dust settles... Also; Several analysts are forecasting a $56 share price in 2021 when yields and costs return to normal. 

 

link please

[chipmaster]

8 minutes ago, Farts said:

link please

 

Seriously in the internet age you can't find out yourself ?   

 

This is a good place to start and evaluate:  https://finance.yahoo.com/quote/CCL?p=CCL

 

[chipmaster]

3 minutes ago, CarelessAndConfused said:

 

I think the market as a whole is way overvalued and has been for awhile.  I don't buy into the Benjamin Graham thesis of comparing to the long bond and since the rates are so low that it's okay that PEs are 20-25 on the market as a whole.  PEs should be 60+ and the DOW at 70,000 if we want to use such a simple metric.  Huge fiscal deficits, Fed doing its shenanigans, corporate bonds possibly ready to implode at some point in the near future. Heck, we're talking about how stocks have been so beat up lately yet they're still about where they were 6 months ago when I felt the market was way overvalued.  But still, I think CCL actually has an argument to be made of being undervalued even here if you're talking about the long term.  Having said that, it will depend largely on what unfolds over the next few months.

 

[Farts]

27 minutes ago, chipmaster said:

 

Seriously in the internet age you can't find out yourself ?   

 

This is a good place to start and evaluate:  https://finance.yahoo.com/quote/CCL?p=CCL

 

Calm down. I just wanted to see when the projected stock price of $56 was made in relation to covid 19.

[chipmaster]

3 hours ago, Kenswing said:

When they come back with positive test results from the Grand, Monday will be another blood bath.  I'm waiting for the teens before I buy again. 

 

Test positive, and likely across the country more cases, and more schools closing and more companies WFH, etc. etc. etc. 

 

Actually even more amazing the stock market stayed up January and had the dead cat bounces it did.

[drowelf]

17 hours ago, caribill said:

 

No obvious minimum number of shares requirement. Stock must be registered in your name, so you must own it directly, not part of a brokerage account. Reservations must be paid in full when made and are non-refundable if cancelled or dates changed.

What do you mean by a brokerage account? We have (had) our CCL and RCL shares in the DWs IRA-SEP Account over which we have direct control of how the assets are allocated. As we can buy/sell stocks/EFTs/Mutuals, I consider that a brokerage account. 

[drowelf]

7 hours ago, ed01106 said:

I wonder to what extent CCL and the other lines verify the applications for OBC to make sure ownership is still current.  Wouldn’t be that hard the corporation has a record of all owners.

Ownership does not have to be current. As I remember the disclaimer in the StockHolders benefit before 2011 states that you have to own the stock within a 6 month period prior to the cruise. But that text is no longer in the any of the copies I have from 2011 onward. 

[Farts]

8 hours ago, CarelessAndConfused said:

I would NOT pay any attention to analyst stock price projections.  The market is perennially littered with “target prices” for hundreds and thousands of stocks that are well above current levels that mean nothing.  Often times you have the same firm but different person calling it a sell.  Then there’s the whole trading positive analyst coverage in exchange for investment banking business, which is technically illegal but goes on all the time anyway.

I am very skeptical. It was just a nice way to voice my skepticism without calling out the poster. Hence, why I asked what his source was.

 

There is no way to get an accurate valuation of any cruise company during this crisis. We are on the cusp of an epidemic here in the US. I am sure that will get reflected in the stock prices sooner or later.

[Farts]

21 cases of covid 19 on grand princess. Stocks are going to fall again come monday.

[travelhound]

We are booked in the Regal leaving March 22nd. They were delayed today and are currently cleared to disembark and waiting for some paperwork. In the meantime, they had to cancel the cruise that was leaving today, but the good news is no one is sick. Hopefully they will be able to sail on the 15th. We received a $200 OBC not to cancel our cruise.

 

The only bright side of this crappy market is that oil is so low that hopefully that will help Carnival's bottom line.

[Plant]

On 3/6/2020 at 6:47 PM, CarelessAndConfused said:

 

Meaning instead of the shares being held by your brokerage account, you actually have a fancy looking stock certificate that shows your 100 shares (or how many ever) of ownership in the the IHG.  Something like this:

 

https://www.ebay.com/itm/Carnival-Corporation-Stock-Certificate/183965342813?hash=item2ad5305c5d:g:uTAAAOSwtw9b9HOw

 

It's like owning a bearer bond except the stock certificate should be registered in your specific name.  It's a very inefficient way of owning stocks and actual physical stock certificate ownership in public companies are virtually non-existent today and have been for many decades.

Not true!  We've had Carnival stock with several brokerages and used our Proxy Vote statement as proof of ownership.  Very easy!

[rkacruiser]

CCL price?  RCL price?  

 

My opinion:  "the shoe has yet to drop" and hit the floor.  

[bluesea321]

1 minute ago, rkacruiser said:

CCL price?  RCL price?  

 

My opinion:  "the shoe has yet to drop" and hit the floor.  

 

Tomorrow will be a bloodbath; would not surprise me if they put a trading hold on the stock.

[PrincessLuver]

6 minutes ago, bluesea321 said:

 

Tomorrow will be a bloodbath; would not surprise me if they put a trading hold on the stock.

 

Futures are already showing a 900 point drop for tomorrow morning.....yikes!!!

[travelhound]

23 minutes ago, Plant said:

Not true!  We've had Carnival stock with several brokerages and used our Proxy Vote statement as proof of ownership.  Very easy!

You don't even need a proxy vote statement. Our shares are part of a trust at a brokerage firm and we just went on line and printed a very simple statement within days of buying it. It's not as beautiful as the printed example, but I'm not sure they give things out like that anymore.

[Plant]

1 minute ago, travelhound said:

You don't even need a proxy vote statement. Our shares are part of a trust at a brokerage firm and we just went on line and printed a very simple statement within days of buying it. It's not as beautiful as the printed example, but I'm not sure they give things out like that anymore.

Yes, you can use any proof.  We just find it easy to use the Proxy Vote. You don't have to black out any other info.

[travelhound]

We didn't do that because we bought the stock on a Friday and applied for the OBC on Monday, so no time to get it. The purchase statement was easy though.

[npcl]

47 minutes ago, travelhound said:

We are booked in the Regal leaving March 22nd. They were delayed today and are currently cleared to disembark and waiting for some paperwork. In the meantime, they had to cancel the cruise that was leaving today, but the good news is no one is sick. Hopefully they will be able to sail on the 15th. We received a $200 OBC not to cancel our cruise.

 

The only bright side of this crappy market is that oil is so low that hopefully that will help Carnival's bottom line.

Don't think that will help very much.  With the Grand quarantine, the cancellation of the Royal and Regal cruises, The issues with the Panorama.  The comments from the State department and others about not cruising.  The long wait times due to people canceling cruises.  I expect the stock will continue its downward movement.