Carnival Share Price Ticks Higher Amid Optimism by Investors

Carnival share price has staged a strong recovery in the past few days, wiping out previous losses as investors cheer the recovery in the cruise industry. The company’s shares jumped by 4.16% to 766p in London’s trading session on Wednesday. The company’s market cap currently stands at 10.33 billion pounds.

Optimism is Increasing

Carnival share price has been in the green for three consecutive days amid hints at a recovery in the cruise industry. The CCL stock has surged 27.99% in the year to date, ranking it among the best performers in London’s FTSE 250 index. However, Carnival’s shares remain more than 18% below their highest level this year.

Carnival’s stock price has been performing relatively well for the past few days on the back of strong quarterly performance by its rival Norwegian cruise line. Earlier this month, the Norwegian cruise line announced a $1.82 billion increase in its first-quarter revenue against the backdrop of surging demand, exceeding analysts’ estimates by 4.5%.

Additionally, the company’s total revenue per passenger cruise day edged 19% higher compared to 2019. Looking ahead, the company expects revenue to grow 9.1% p.a on average during the next three years. As such, investors remain hopeful as they anticipate strong financial performance by Carnival ahead of its trading update in June.

Even so, Carnival’s massive debt remains a concern for investors and shareholders. Like most cruise line stocks, Carnival has a long way to go in the recovery from the damage caused by the coronavirus pandemic.

Carnival Share Price Outlook

Carnival share price has been moving sideways for the past few weeks, trading between the range of 616p and 780p. On the daily chart, the CCL stock has managed to move above the 25-day and 50-day exponential moving averages. Its Relative Strength Index (RSI) has climbed further, hovering slightly below the overbought zone.

Consequently, the Carnival share price is likely to continue rising in the ensuing session amid optimism by investors. The next key resistance level to watch will be its highest level since March at 856p. Even so, we cannot rule out a move below the support level at the 50-day EMA at 710p.

CCL Price Chart

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