Carnival Shares: Analysts Split as Strong Q1 Collides With Oil Shock and Guidance Cut

Carnival Corp’s (LON: CCL) latest earnings have drawn mixed reactions from analysts after the cruise operator delivered a stronger-than-expected first quarter but trimmed its full-year profit outlook due to surging fuel costs tied to Middle East tensions.

First-quarter revenue rose 6% to $6.2 billion, supported by strength in late bookings, while underlying EBITDA grew 5% to $1.3 billion, slightly ahead of guidance even after a $54 million fuel hit. Improved cash generation lifted free cash flow to $0.7 billion, and Carnival ended the quarter with $23.9 billion in net debt.

However, full-year EBITDA guidance was revised down from roughly $7.6 billion to $7.2 billion.

Analysts at Hargreaves Lansdown said the downgrade was “not surprising” given the spike in oil prices following the Iran conflict, though the firm flagged that Carnival’s updated guidance assumes oil prices fall about 23% before peak season.

The group also highlighted geopolitical and macro uncertainty as key risks, warning that “cruising can be a fickle business” even as demand indicators remain solid.

The company announced more than $0.8 billion in expected dividends for 2026 and a new $2.5 billion buyback, part of a wider plan to return $14 billion to shareholders by 2029. But Hargreaves Lansdown said the buyback “wasn’t enough to steady nerves on the day.”

Carnival’s London-listed shares closed Friday’s session down 3.4% at 1,830.5p.

Morgan Stanley took a more upbeat view, arguing that Carnival “delivered almost all the positives it could have” and calling the stock’s 4% post-earnings slide “anomalous.”

Meanwhile, HSBC upgraded Carnival to Buy with a $30.10 price target, while Stifel reiterated its Buy rating and $35 target.