Founded in 1972 and headquartered in Miami, Florida, Carnival Corporation & plc (CCL) is a cruise company that provides leisure travel services in North America, and internationally. With a market cap of $21.8 billion, the company operates through four segments: NAA Cruise Operations, Europe Cruise Operations, Cruise Support, and Tour and Other. 

Shares of this leading cruise company have significantly outperformed the broader market over the past year. CCL has surged 23.8% over this time frame, while the broader S&P 500 Index ($SPX) has rallied 10.6%. CCL’s stock is down 26.4%, compared to the SPX’s 5.3% decline on a YTD basis. 

Narrowing the focus, CCL has outperformed the Dynamic Leisure And Entertainment Invesco ETF's (PEJ). The exchange-traded fund has declined 8.6% over the past year. Moreover, the ETF’s 8% decline on a YTD basis outshines CCL’s higher loss.

CCL’s outperformance can be traced back to its amazing performance over the past few years. Revenue has exceeded pre- pandemic numbers and continues to increase, and demand is incredibly strong. The company continues to book out on its longest-ever curve, tickets are at high prices, and onboard spending is also strong. 

On Mar. 21, CCL stock declined 1.2% after reporting better-than-expected first-quarter earnings results. Its revenue came in at $5.8 billion, up 7.5% year-over-year and ahead of analyst estimates by 1.1%, and its adjusted EPS came in at $0.13, well above Wall Street expectations.

For the current fiscal year, ending in November, analysts expect CCL’s EPS to rise 30.3% year over year to $1.85 on a diluted basis. The company has an impressive track record of outperforming expectations, having surpassed the consensus estimate in all of the last four quarters

Among the 25 analysts covering CCL stock, the consensus is a “Strong Buy.” That’s based on 18 “Strong Buy” ratings, one “Moderate Buy,” and six “Holds.”

This configuration is more bullish than two months ago, when 17 analysts gave the stock a “Strong Buy.”

On Apr. 22, Barclays analyst Brandt Montour lowered the firm’s price target on Carnival to $26 from $32 and kept an “Buy” rating on the shares.

The mean price target of $27.88 represents a 52% premium to CCL’s current price levels. The Street-high price target of $34 suggests an upside potential of 85.4%.