Carnival Corporation Stock Question

[Oak Hill Cruisers]

OK, for better or worst, we purchased 200 shares of Carnival Corporation stock.

 

We know about the per stateroom OBC perks of $50 for cruises of 6 days or less, $100 for cruises of 7-13 days, and $250 for cruises of 14 days and longer.

 

Any other recent or promotional perks that HAL guests enjoy other than the OBC?

 

Thanks in advance.

[PORT ROYAL]

2 minutes ago, Oak Hill Cruisers said:

OK, for better or worst, we purchased 200 shares of Carnival Corporation stock.

 

We know about the per stateroom OBC perks of $50 for cruises of 6 days or less, $100 for cruises of 7-13 days, and $250 for cruises of 14 days and longer.

 

Any other recent or promotional perks that HAL guests enjoy other than the OBC?

 

Thanks in advance.

Quarterly share dividend

[KirkNC]

Never mind, I see they have already extended the benefits thru July 2021.

Edited May 3, 2020 by KirkNC

[PORT ROYAL]

1 minute ago, KirkNC said:

I would be surprised if they don’t suspend the OBC for stock ownership.  I think it is renewed by the board in June?

 

Heard a rumour on the site that Carnival could increase the shareholding requirement to 500, if so, we're okay, after buying and trading very well recently.

 

[KirkNC]

2 minutes ago, PORT ROYAL said:

 

Heard a rumour on the site that Carnival could increase the shareholding requirement to 500, if so, we're okay, after buying and trading very well recently.

 

As I corrected my previous post, they have committed thru July 2021.  I guess they can always change it. I guess they decided that taking away the OBC would piss too many people off, the last thing they need right now.

[prescottbob]

31 minutes ago, PORT ROYAL said:

Quarterly share dividend

 

https://www.marketwatch.com/story/carnival-to-suspend-dividend-and-stock-buybacks-expects-to-remain-in-compliance-with-debt-covenants-2020-03-31?mod=home-page 

[chipmaster]

Whats the value of an OBC if there is no sailing anytime in the future and the whole industry will be different when you come back?

 

Better look for your perks in otherways... it's going to get a lot worse than better for the next few months;  no cash, all the bad press and looming credit payments due.  

 

 

[ski ww]

What is the cost of a share today, and will they still give OBC if CCL took such a hit?

[ontheweb]

4 hours ago, PORT ROYAL said:

 

Heard a rumour on the site that Carnival could increase the shareholding requirement to 500, if so, we're okay, after buying and trading very well recently.

 

Rumor? It was actually someone speculating. Now you quote it. False News.

[PORT ROYAL]

1 minute ago, ontheweb said:

Rumor? It was actually someone speculating. Now you quote it. False News.

 

Thank you for the clarification.  

But think the minimum holding of 500 shares is a better way forward.

At this present time, 500 and plus holders only receive the same as 100 holders.  Is this fair?

Or, actually have a sliding scale of OBC based on the holding.  With 500 and over receiving the current range of OBC, with 100 holders receiving 20% of the current benefits.

 

 

 

[rkacruiser]

I first purchased many years ago my shares in CCL because I believed in their business model.  Having sailed on their ships, I thoroughly enjoyed their product.  The benefit of the Shareholder Onboard Credit was an additional non-taxable dividend benefit.  It was not the prime reason why I made that initial investment and have continued to do so with their dividend reinvestment plan.  

 

Am I heading for the exits on this investment?  No.  Am I concerned?  Yes.  Am I going to buy more shares in the near future?  No.  Will CCL become bankrupt?  If one looks at those who hold the greatest majority of shares, every attempt will be made to prevent that to happen.  It's in their own best personal interest.  

[freestyling]

Or they could use original date of shareholder ownership, so not to penalize those longer term share holders who have already lost share value and perhaps requiring more shares for those who’s stock was purchased after Feb 28th. 

[rkacruiser]

7 minutes ago, freestyling said:

Or they could use original date of shareholder ownership, so not to penalize those longer term share holders who have already lost share value and perhaps requiring more shares for those who’s stock was purchased after Feb 28th. 

 

To what are you referring?  OBC?

[YXU AC*SE]

6 hours ago, ski ww said:

What is the cost of a share today, and will they still give OBC if CCL took such a hit?

 

I suppose one may view OBC as a dividend (and theoretically tied to free cash flow), but really all it is is a perquisite.   My average cost when I initially bought in was 14.24 USD -- it currently is 13.92.  OBC has not moved during that time.  I expect that in the greater scheme of things, by offering that spiff, CCL recovers the offer value and then some with incremental onboard spend, when one looks at marginal costs. Further, there is the value of capturing master brand loyalty -- where you might not cruise HAL but you will prefer CCL over RCI/NCL/alt. All to say, these marketing considerations are independent of share price.    Scott. 

 

 

 

Edited May 4, 2020 by YXU AC*SE

[freestyling]

2 hours ago, rkacruiser said:

 

To what are you referring?  OBC?

Yes OBC

[ontheweb]

13 hours ago, PORT ROYAL said:

 

Thank you for the clarification.  

But think the minimum holding of 500 shares is a better way forward.

At this present time, 500 and plus holders only receive the same as 100 holders.  Is this fair?

Or, actually have a sliding scale of OBC based on the holding.  With 500 and over receiving the current range of OBC, with 100 holders receiving 20% of the current benefits.

 

 

 

It is a marketing tool to both get small investors and have them sail on the various Carnival brands once they own the stock. A $10 or $20 OBC will not accomplish that.

 

The suggestion that it go to 500 shares was made on these boards when the stock price was at about $8, figuring that was 1/5 of $40. By that logic, when it is about $16, you should set the bar at 250 shares, 2/5 of $40.

 

In the time we have had the stock (which we bought when it was in the low to mid $30 range), the highest I remember seeing it was briefly in the low $70 range. Would you then put the requirement closer to 50 shares to get the OBC?

[PORT ROYAL]

4 minutes ago, ontheweb said:

It is a marketing tool to both get small investors and have them sail on the various Carnival brands once they own the stock. A $10 or $20 OBC will not accomplish that.

 

The suggestion that it go to 500 shares was made on these boards when the stock price was at about $8, figuring that was 1/5 of $40. By that logic, when it is about $16, you should set the bar at 250 shares, 2/5 of $40.

 

In the time we have had the stock (which we bought when it was in the low to mid $30 range), the highest I remember seeing it was briefly in the low $70 range. Would you then put the requirement closer to 50 shares to get the OBC?

 

Thoughts were only directed to the actual number of shares held, regardless of their value.   The introduction of various theyses, evidencing multiple, and potentially  convoluted, value calculations, would over complicate matters.

[ontheweb]

1 minute ago, PORT ROYAL said:

 

Thoughts were only directed to the actual number of shares held, regardless of their value.   The introduction of various theyses, evidencing multiple, and potentially  convoluted, value calculations, would over complicate matters.

I was responding to the person who wanted to give more value with more shares, he or she is the one who actually made it convoluted; I only pointed it out.

 

And the main point is it is a marketing tool, and raising the bar from 100 shares would not be helpful in that function.

[VMax1700]

The shares have a nominal value of $1.66 each.  What people pay for them is irrelevant.  

[Georgeny]

20 hours ago, Oak Hill Cruisers said:

OK, for better or worst, we purchased 200 shares of Carnival Corporation stock.

 

We know about the per stateroom OBC perks of $50 for cruises of 6 days or less, $100 for cruises of 7-13 days, and $250 for cruises of 14 days and longer.

 

Any other recent or promotional perks that HAL guests enjoy other than the OBC?

 

Thanks in advance.

 

No one should really consider an OBC perk when buying this or any stock. I would look at the stocks financials, a perk like this is inconsequential. A great marketing strategy for CCL both for their stock and bookings. There is no significance to share value.

 

Since CCL is so leveraged I would doubt that this perk will be continued. They have already suspended their dividend and stock re-purchase program. They have said they have increased liquidity, that is like the phrase I mis-spoke from a politician caught in a lie. What they increased was their credit lines sold 4 billion junk bonds at 11.5 % to keep, pardon the pun, afloat! All these ships operating expenses remain with virtually no cash flow. A ship must be manned and maintained. Minimum crews must be paid, fed, etc. Fuel must be purchased and burned even at anchor or trolling. Now the investor lawsuits have commenced.

 

Will Carnival survive, I believe so but as a much different company and after some sort of bankruptcy reorganization leaving stock holders holding the bag. CCL looks like a cheap stock right now that's because it is. Another line is worse, you have to understand the history of that line, once family owned driven to bankruptcy by a son without a clue. Refinanced by Chinese and Apollo hedge fund operated I believe.

 

If I was going to buy a cruise stock, and I am not, RCL would be best gamble. Simply because they maintained best margins in pricing for many years. Still their debt level must be looked at closely too.

 

Cash flow is key in cruise industry. They don't buy these huge ships they build using loans. Cash stops, loan payments do not.

 

All just a personal opinion, I only trade my own personal portfolio and have certainly been wrong many times. I will however say again, an OBC would never be anything to consider buying a stock.

 

For what it is worth.

 

George in NY

[TJR_0323]

42 minutes ago, Georgeny said:

a perk like this is inconsequential

 

Prior to all the hysteria..... assume stock can be bought at $50/share.... a $250 OBC per year (more if you do multiple cruises each year) is a 5% yield on your $5,000 investment. Of course, this assumes you'd spend $250 onboard even without it.

5% is far from inconsequential.

[NordicPrince]

22 hours ago, PORT ROYAL said:

Quarterly share dividend

The dividend will be suspended into the foreseeable future.

[ontheweb]

1 hour ago, NordicPrince said:

The dividend will be suspended into the foreseeable future.

Really unfortunate, especially since the dividend had doubled during the time we have held the stock.

 

The only talk I have heard of also suspending the OBC is on these boards. I would hope they see it as a marketing tool and keep it as with all the bad publicity they have been subject to, they need every last bit of marketing promotio.

[drowelf]

23 hours ago, PORT ROYAL said:

Quarterly share dividend

Don't count on that for a few years. I believe they have already stated that the dividend is cancelled for the foreseeable future. 

[cruisemom42]

4 hours ago, Georgeny said:

 

No one should really consider an OBC perk when buying this or any stock. I would look at the stocks financials, a perk like this is inconsequential. A great marketing strategy for CCL both for their stock and bookings. There is no significance to share value.

 

 

 

I beg to disagree. The perk is hardly inconsequential at the recent stock price. For the price I just paid for my 100 shares, I will earn back the money spent in just 4 cruises of 14-days or longer (I tend to avoid shorter cruises....)

 

There has been zero talk about changing the OBC -- in fact, I believe it has already been confirmed through mid-2021. Too much reading of tea leaves on these forums sometimes.

 

I expect my 'gain' to come from a risk in stock price over time, having purchased at below $9/share. The dividend is somewhat inconsequential to me.