Carnival Upgraded to Buy at Jefferies, Shares Gain 3%
<p>Jefferies upgraded <a href='https://financialmodelingprep.com/financial-summary/CCL'>Carnival (NYSE:CCL)</a> to Buy from Hold, accompanied by an increase in the target price for the stock from $9 to $25 per share. Shares gained more than 3% pre-market today. In a note to investors, the analysts highlighted several factors that influenced the decision.</p>
<p>According to the analysts, the recent leadership change, along with the recovery in supply and demand, has led to a significant shift in the company's value from debt to equity. They believe this shift makes Carnival shares more attractive for broader investment, with the potential for progress over multiple years.</p>
<p>The analysts noted that the new CEO, who has been in the position for 11 months, has implemented structural changes within Carnival, resulting in a flatter and more efficient reporting structure. This has enabled direct reporting relationships for 93% of the company's total brand capacity to the CEO.</p>
<p>The analysts also highlighted favorable fuel costs as a tailwind for the company. Decreasing fuel prices, coupled with increased fuel efficiency due to a fleet upgrade with newer ships, are expected to improve margins and bring them back to pre-pandemic levels. The reduction in fuel consumption is projected to generate approximately $250 million in annual savings in 2023 compared to 2019, with further improvements anticipated by 2026.</p>

NYSE:CCL