The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
Is no one willing to share the burden of responsibility with me? Can my mental health stand the strain? Only divine intervention can help, I think. Looks like I shall have trousers with worn-out knees……..
B
RiskyB - like many, I think you overstate Carnival’s position re debt. Don’t get me wrong, it is huge BUT they have a strategy in place and well over 80% of it is on fixed rates. Besides that, they have paid down more than they forecast and will be able to do that again over the next year. Achieving “investment grade” in 2026 means the debt must be below a certain level in relation to Cap Value and they are on target for that, too.
Results for Q1 at tge end of this month will be telling - on the plus side of expectations, I think.
B
Bot,
IMHO I do not have a scooby, as they say. If I were to try, it would inevitably the opposite way.
That’s just how it is, so I don’t do anything and try to tell myself that is a positive decision. 😂
B
Thanks TW.
Sadly, history shows that no matter how positive the results, statements and outlook from Carnival have been over the years since COVID, the immediate reactions are almost always a brief positive then a slide. It’s come a long way since the £4.95 low, though!
Have to hope that this quarter is better received. Some one will inevitably focus on the debt.
2026 must big the big target, though, when they plan to achieve “investment grade”.
B
Agreed, JD. But if they didn’t have a plan…… what sort of company would they be?
There is one question, or more, that I have not posed on here before and it probably apply to a number of large, multinational companies.
How under control are the overheads? They have a huge set-up in Miami at he HO, who will b3 setting strategy and all sorts of important stuff but is it all really necessary? Do they keep it under review? There are some very fancy salaries (+ share options we have seen sold lately) being paid.
B
Who knows? Is the right question but the answer is totally elusive.
JD, if you read the reports and listen to output from Carnival, you will know they have a debt repayment strategy which will bring them to “investment grade” status in 2026. That means that debt will be reduced, as as I understand it, to a level of less than one third of its current level of around $26 bn. I believe debt was about $5bn pre COVID. It would also mean they start paying dividends again.
The usual pattern is a large pre-results rise. Then, when someone ignores the results and
finds something negative to say, a trailing off. There is absolutely no logic to this because the company is either sound or it isn’t. The amount of sentiment behind SP fluctuations is enormous and ridiculous.
I think Bot’s longer-term prediction may be slightly optimistic but certainly possible.
B
Results should be on last Thursday of March.
Need to bear in mind, too, that the Bahamas Cay is getting two extra berths to allow four, yes FOUR, ships in at once.
Not for me!
Still on track to achieve investment grade in 2026. Patience needed.
B
I am not sure why you all sound so disappointed! We know perfectly well how this share behaves.
IAG produced better than expected results and………the share price slipped.
Following this day by day isn’t a great idea, unless you’re day-trading, which I don’t think many of us are.
B