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History suggests CCL could underperform over the next month

  • The chart below shows the stock’s performance following the Carnival Splendor fire on 11/8/2010 as a comparison to the current Carnival Triumph fire. 
  • CCL underperformed for 3 weeks and it took the stock a month and a half to recover its losses vis a vis the S&P 500.  However, the stock did recover, although some of that was earnings related.
  • The publicity is much worse this time.   Normally, we would buy the negativity but this kind of hype is likely to affect bookings for a period of time – potentially more damaging during the busy wave season - that could lengthen the stock’s recovery period.

CHART DU JOUR: CCL: IT COULD GET SMELLIER - ccl1