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Carnival PLC Shares Surged 10.6% Today After Closing 10.4M Direct Share Offering

Simon Mugo trader
Updated 24 Nov 2020

Practice Stock Trading
Carnival Cruise Lines

Shares of Carnival plc (LON: CCL) surged 10.6% today after the cruise operator announced that it had closed the previously announced registered direct offering of 10.4 million shares of its common stock at $17.59 per share to a holder of its 5.75% Convertible Senior Notes due 2023 (the “Convertible Notes”).

The company used the proceeds of the sale to repurchase $90.8 million principal amount of its Convertible Notes in a privately negotiated transaction. The transaction had no material impact on Carnival’s cash position, given that it did not receive any cash proceeds.

Carnival operates some of the leading cruise line globally including Carnival Cruise Line, Princess Cruises, Holland America Line, Seabourn, P&O Cruises (Australia), Costa Cruises, AIDA Cruises, P&O Cruises (UK) and Cunard.

Analysts at the major banks have a buy rating on Carnival stock despite the cruise operator having to suspend its operations for most of this year due to the coronavirus pandemic and the resulting lockdown measures.

The cruise operator’s stock has rallied higher this month following news relating to coronavirus vaccines, which shifted investor sentiment towards the cruise ship operator back into positive territory fueling its latest rally.

Carnival Corp & plc is in the middle of a major capital-raising operation having recently announced the issuing of 7.625% senior unsecured notes due 2026 (the “USD Notes”) worth $1,450 mln ($1.45 bn) and a euro-denominated batch worth €500 million.

Carnival plc share price

Tradingview chart of Carnival share price 24112020

Carnival plc shares today surged 10.6% to trade at 1333.5p having rallied from Monday’s closing price of 1205.5p.

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Simon has over six years of professional trading experience across FX, commodities and equities. He has a strong passion for financial markets and is particularly focused on price action trading