Insiders Are Cruising on Carnival Corporation (CCL)

Published on June 5, 2013 at 9:39 am by The Motley Fool in Insider Trading

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NCL, the global cruise line company, is considered to have the most modern fleets of cruise ships, with a weighted-average age of more than 8 years. The company reported that it differentiates itself from all major cruise brands by “Freestyle Cruising.. It means that its customers could choose the date, time of dining and they do not have to dress formally. In the first quarter of 2013, NCL experienced a decent rise in its revenue, from $515.4 million in the first quarter last year to more than $527.6 million. However, the net income came in at a loss of $96.4 million. The loss was due to higher costs of marketing, general and administrative, and a much higher interest expense. The adjusted net income was positive at $12.9 million, or $0.06 per share, after adjusting the non-cash share-based compensation related to IPO and debt prepayments. For the full year 2013, the company expected to produce around $1.20 to $1.40 earnings per share. NCL seems to have the highest valuation of the trio. At $30.80 per share, NCL is worth around $6.3 billion on the market. The market values NCL at as high as nearly 15.8 times EV/EBITDA.

Income investors might like Carnival the most as it pays the juiciest dividend yield at 3%. While Royal Caribbean offers investors dividend with a much lower yield at 1.3%, NCL has not paid any dividends yet.

My Foolish take

With a decent dividend yield, consistent cash flow generating ability and a reasonable valuation, Carnival Corporation (NYSE:CCL) seems to be a decent stock for investors at the current trading price. The significant recent insider buy in the company would give investors more confidence to accumulate Carnival Corporation (NYSE:CCL)’s shares now.

The article Insiders Are Cruising on Carnival originally appeared on Fool.com and is written by Anh Hoang.

Anh HOANG has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Anh is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.