CCL offers another 1 Billion in common stock :(

[willoL]

1 hour ago, JesseLivermore said:

 

wow. How quickly does the OBC post? I have a 7/31 cruise coming up.  This would be my version of gambling 😉 

I believe as long as you own the shares before you sail, you will get the OBC, but this is my first time using the Shareowner Credit, so YMMV. With CCL at $9.22, you'll have to invest $922 to start playing the game. Is it worth it? (How many days is your 7/31 cruise? How much do you get back ASAP in OBC? The immediate payoff is much better if you're sailing 14+ days. Better yet if you believe the long term outlook for CCL is good. I almost never pay short-term capital gains.)

 

I believe there are folks who buy & sell before/after voyages for this very reason! Not my usual modus operandi, so do with that what you will. Mostly, my few individual stocks are DRIP investments; I'll admit it: buying CCL was a lark. I don't gamble in the casino or buy lottery tickets, but this was $500 back within a couple of months on an investment of $1k, so I'll buy and hold and see what happens. 🤷🏼‍♀️

[JesseLivermore]

21 minutes ago, willoL said:

I believe as long as you own the shares before you sail, you will get the OBC, but this is my first time using the Shareowner Credit, so YMMV. With CCL at $9.22, you'll have to invest $922 to start playing the game. Is it worth it? (How many days is your 7/31 cruise? How much do you get back ASAP in OBC? The immediate payoff is much better if you're sailing 14+ days. Better yet if you believe the long term outlook for CCL is good. I almost never pay short-term capital gains.)

 

I believe there are folks who buy & sell before/after voyages for this very reason! Not my usual modus operandi, so do with that what you will. Mostly, my few individual stocks are DRIP investments; I'll admit it: buying CCL was a lark. I don't gamble in the casino or buy lottery tickets, but this was $500 back within a couple of months on an investment of $1k, so I'll buy and hold and see what happens. 🤷🏼‍♀️

 

Good advice,  would try it as a lark.  It's a 7 day cruise but it does say 4 weeks prior here https://www.carnivalcorp.com/static-files/50351a91-4dc0-4f6b-bfec-684647e6129f , so I'm OOL 

 

Interesting chart to say the least, but short of a reorg/BK I see some upside long term. 

https://digital.fidelity.com/prgw/digital/research/quote/dashboard/summary?symbol=CCL

Edited July 25, 2022 by JesseLivermore

[cruisetravlr]

13 hours ago, JesseLivermore said:

 

Good advice,  would try it as a lark.  It's a 7 day cruise but it does say 4 weeks prior here https://www.carnivalcorp.com/static-files/50351a91-4dc0-4f6b-bfec-684647e6129f , so I'm OOL 

 

Interesting chart to say the least, but short of a reorg/BK I see some upside long term. 

https://digital.fidelity.com/prgw/digital/research/quote/dashboard/summary?symbol=CCL

I would still give it a try to get the OBC. We left on a Wednesday for our cruise in March. Saw about this stockholder OBC while browsing on CC. Put in for it the Sunday before we left and marked email as “Please expedite”. Received a hand-delivered note from Guest Services on the Tuesday of the cruise!  So, it was just over a week after applying. We were on an 11-day cruise. It can’t hurt to try. I had several cruises taken with HAL and Carnival and only found out about the OBC from the wonderful folks on CC.  🤗

[BermudaBound2014]

Problem with buying the stock just for OBC is that this stock is volatile. If you bought 100 shares last Wednesday you have already lost $150; not to mention your stock was diluted on-top of that $50 loss.  

 

On the flip side, If you believe the company can survive without further dilution and/or restructuring, then now is as good as any to invest since it was trading in the $8's at the opening bell. At less than $10 a share this is a very inexpensive investment. If you can't afford to lose $1,000 you probably shouldn't be in the game.

 

 

[friendswithdave]

17 hours ago, JesseLivermore said:

 

wow. How quickly does the OBC post? I have a 7/31 cruise coming up.  This would be my version of gambling 😉 

For me it was about 2 weeks, very recently. That is quicker than other recent stories I've heard.

[BermudaBound2014]

Those of you on the fence may want to wait until next week to see how this shakes out. Cruise line stocks could see significant decline. The Feds announce interest rate, Bureau of Economics reports on first half of 2022, RCL releases third quarter August 2nd, and NCLH releases August 4th. 

 

https://www.fool.com/investing/2022/07/25/why-cruise-line-stocks-are-sailing-slower-today/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article

[rkacruiser]

1 hour ago, BermudaBound2014 said:

Those of you on the fence may want to wait until next week to see how this shakes out. Cruise line stocks could see significant decline. The Feds announce interest rate, Bureau of Economics reports on first half of 2022, RCL releases third quarter August 2nd, and NCLH releases August 4th. 

 

https://www.fool.com/investing/2022/07/25/why-cruise-line-stocks-are-sailing-slower-today/?source=eptyholnk0000202&utm_source=yahoo-host&utm_medium=feed&utm_campaign=article

 

Motley is interesting to read, but, they are out to see their product and I don't put much "stock" into their reports.  As I suggested in a post on another thread, informed investors of cruise line stocks ought to have the coming negative news "baked into" the current price of all of the cruise line stocks.  Will the market drop on such news?  Does Christmas come on December 25th?  I would be surprised that the overall market won't react negatively this week.  

[BermudaBound2014]

1 minute ago, rkacruiser said:

 

Motley is interesting to read, but, they are out to see their product and I don't put much "stock" into their reports.  As I suggested in a post on another thread, informed investors of cruise line stocks ought to have the coming negative news "baked into" the current price of all of the cruise line stocks.  Will the market drop on such news?  Does Christmas come on December 25th?  I would be surprised that the overall market won't react negatively this week.  

I’m not sure what you point is- No one pays attention to Motley’s advice lol-

 

This article was not offering advise. It was just reporting facts which will likely move cruise stock - 

1- feds release

2- Bureau of economics release 

3- rcl releases 

4- nclh releases 

as far as being baked in, no more or less than any stock is before a news release. My point was having 4 news releases in the next 2 weeks leaves opportunity for more volatility. 

[rkacruiser]

20 hours ago, willoL said:

Mostly, my few individual stocks are DRIP investments; I'll admit it: buying CCL was a lark.

 

The largest of my two pots that hold CCL stock was an initial investment many years ago of a very modest amount that DRIP has allowed to grow to a nice sized holding.  I bought not as a lark, but, I bought based upon what I experienced as a very satisfied customer of the company.  I thought I reasonably well understood my investment and why I was investing.  (I am a Buffet rule follower.)  I remain confident in the company.  

 

I didn't invest because of the Shareholders OBC.  That is a very poor reason to make an investment in the Market.  Such a benefit can disappear just like those of us who invested in McDonald's in the past and received coupons for free menu items in the Shareholder's Annual Report.  However, given the price of the stock today, if one has 100 shares worth of money to gamble, do so.  But, I'd suggest that you "buy and hold".  Transaction costs for trades have to be taken in consideration for many small investors.  

[rkacruiser]

7 minutes ago, BermudaBound2014 said:

No one pays attention to Motley’s advice

 

Are you sure?  😀

 

9 minutes ago, BermudaBound2014 said:

as far as being baked in, no more or less than any stock is before a news release.

 

You may be correct.  We will see.  

[JesseLivermore]

Macro factors are "choppy" to say the least (hopefully unlike AK next week 😉 )

[BermudaBound2014]

CCL is down another 5% in the first 30 minutes of trading. Currently at $8.70. Buckle up for the ride.

Edited July 26, 2022 by BermudaBound2014

[gilboman]

On 7/21/2022 at 7:06 PM, Boatdrill said:

A good read from Travel Weekly's columnist about the current and future state of cruise lines and the travel industry as a whole. https://www.travelweekly.com/Arnie-Weissmann/With-Crystal-revival-a-major-miracle

 

A snippet: [during the pandemic, and now] "It was particularly hopeful to see votes of confidence in the travel industry come in from every class of investor: private equity, sovereign funds,  investment banks, public markets, wealthy individuals, and in many cases, existing financial partners who invested even more money.  Money flowed into every industry sector from rental cars to tour operators to cruise to airlines to technology."

.....   "Putting money into travel businesses is, in part, a faith-based decision: faith that travel is inherent to the human spirit. In other words, a safe bet."   

travel is a safe bet...but cruising (at least in it's current form especially the mainstream lines) is not.

 

 

Edited July 26, 2022 by gilboman

[gilboman]

On 7/22/2022 at 7:23 AM, BermudaBound2014 said:

 

This is a nice feel good article written by a company whose job it is to make us feel good about travel.

 

Unfortunately it doesn't address the fact that cruise ships are the only travel that was shuttered for over a year and, up until recently, held hostage to covid protocols that the rest of the travel industry were exempt from. As a result, the balance sheets of the cruise industry are in significantly worse shape than the balance sheets of the remaining travel sector (airlines, car rentals, hotels, etc..) 

 

At this point, it's all about servicing the debt that the cruise lines have accumulated. In the case of Carnival, that is 35 Billion dollars. To put this in perspective, their net income in 2019 was only 3 Billion dollars. Assuming they can bounce back to pre-pandemic profits in 2023 (they can't), if you factor in interest on the loans, the debt looks insurmountable. 

not really...look at cathay pacific airline... passenger volume still down 95% from prepandemic as hong kong requires 7 day hotel quarantine and no leisure travel allowed  but cathay have very healthy balance sheet and is still profitable .

 

Cathay Pacific Airways is perhaps the world’s most beleaguered major airline. The Hong Kong-based carrier is at the mercy of its home's tough COVID rules, which force international arrivals to spend weeks in isolation. Cathay is flying just 2% of the passenger flights it operated before the pandemic. Staff have quit amid tough quarantine requirements. Local politicians berated the airline after two of its flight attendants were accused of sparking the city's worst-ever COVID outbreak.

 

Yet investors are still flocking to the airline. Cathay Pacific is the world’s best-performing airline stock, outperforming its regional and global competitors. 

Shares in the Hong Kong-based airline are up 26.4% over the past twelve months. By comparison, the Dow Jones U.S. Airlines Index is down 30% over the same period. The STOXX Europe Total Market Airlines Index, which tracks ten European airlines like Ryanair, Deutsche Lufthansa, and British Airways parent International Consolidated Airlines Group, is down 35%.

 

Cathay Pacific has even outperformed other Asian airlines, whose shares have largely fared better than their Western counterparts. Shares of Singapore Airlines are up just 3% over the past 12 months, even though the Southeast Asian city-state has reopened to the outside world far more quickly than Hong Kong. 

Edited July 26, 2022 by gilboman

[Gail & Marty sailing away]

On 7/25/2022 at 11:50 AM, BermudaBound2014 said:

Problem with buying the stock just for OBC is that this stock is volatile. If you bought 100 shares last Wednesday you have already lost $150; not to mention your stock was diluted on-top of that $50 loss.  

 

On the flip side, If you believe the company can survive without further dilution and/or restructuring, then now is as good as any to invest since it was trading in the $8's at the opening bell. At less than $10 a share this is a very inexpensive investment. If you can't afford to lose $1,000 you probably shouldn't be in the game.

 

 

I think a lot of people buy the 100 shares not for a investment,  but for the OBC.

I did just that.

[willoL]

19 hours ago, rkacruiser said:

I bought not as a lark, but, I bought based upon what I experienced as a very satisfied customer of the company.  I thought I reasonably well understood my investment and why I was investing.  (I am a Buffet rule follower.)...

 

I didn't invest because of the Shareholders OBC.  That is a very poor reason to make an investment in the Market.  Such a benefit can disappear

 

...However, given the price of the stock today, if one has 100 shares worth of money to gamble, do so.  But, I'd suggest that you "buy and hold".  Transaction costs for trades have to be taken in consideration for many small investors.  

Buying for OBC--if a person will get back all of their investment within a matter of mere months because they're cruising a few times anyway, and for a person who can afford to invest $1000 and risk its loss--means the new investor earns back the totality of the initial outlay, while ALSO potentially holding a stock that will probably continue to grow over time. I respectfully disagree that immediate cash back in hand (assuming most of us spend more than the total shareholder OBC anyway on a cruise here, admittedly) is a poor reason to invest in the stock.

 

Perhaps I should also add that, like you, I agree with Buffet, and my lark was inspired because I have reasonable faith in the company I was buying. I have not yet sold any of the stocks I initially chose for DRIP investing, though I don't continue to add funds to all of them; I do hold very long term with no plans to change that approach. (My discretionary investing is just a few tens of thousands, unlike our retirement accounts with are many times that.)

 

If OBC is the only reason a person buys his or her first shares of stock, at least they are investing. I think more people of modest means *should* be in the market. The only way to keep up with inflation is the do what the rich and powerful do; their interests will keep being protected. Thoughtful investments, I mean.

 

I recall convincing my manager at a retail job I held in college to take advantage of the company 401k match. She lived paycheck to paycheck, barely finished high school as a teen mom, and couldn't imagine living without that 4% of her salary, but I talked her into giving it just one month to see if she could live without it. She realized she didn't notice the difference and stayed in the program until she left the company. A few years later, that former manager sent me an email out of the blue thanking me and saying she was the first person ever in her family to have a retirement fund. She was amazed to have thousands of dollars of her own.

 

Most people in America get too little financial education. If OBC prompts someone to try investing, it's not such a bad idea. It's a far better option than buying lottery tickets, which many more hourly wage retail employees I knew did on a regular basis...

[NavyCruiser]

Quick look at Yahoo Finance:

https://finance.yahoo.com/quote/CCL?p=CCL

at $8.50 right now...

Market Cap:  $10 Billion

No PE ratio, since Earnings per share is -8.31 meaning it's losing $$$

No dividends paid

No 1 yr target estimated price

No fair value, & it's considered "Overvalued"

 

So maybe has more room to fall...?

 

[rkacruiser]

6 hours ago, willoL said:

Most people in America get too little financial education.

 

I agree with you!  From what I read, there seems to be a slow realization of this.  

 

6 hours ago, willoL said:

I think more people of modest means *should* be in the market.

 

"Modest means" described me when my Principal and a good friend, who was an advocate of a 403(b) Plan, convinced me to investigate and begin contributions to that type of plan.  Surely glad that I did and now wonder why I didn't contribute a few dollars more each paycheck.  

[LocoLoco1]

$8 and 1/2 bucks today. That’s June 1993 numbers. It’ll be interesting what the on-board experience will be like in Nov. 

[LMaxwell]

On 7/25/2022 at 5:33 PM, rkacruiser said:

 

Motley is interesting to read, but, they are out to see their product 

Pump and Dump on a Subscription 

[BermudaBound2014]

21 hours ago, willoL said:

Buying for OBC--if a person will get back all of their investment within a matter of mere months because they're cruising a few times anyway, and for a person who can afford to invest $1000 and risk its loss--means the new investor earns back the totality of the initial outlay, while ALSO potentially holding a stock that will probably continue to grow over time. I respectfully disagree that immediate cash back in hand (assuming most of us spend more than the total shareholder OBC anyway on a cruise here, admittedly) is a poor reason to invest in the stock.

 

Unfortunately, the downward trend in CCL stock happened long before covid.  In August of 2017 the stock was trading around $70 a share. Buying 100 shares for OBC was $7,000. Today that $7,000 investment is worth $860. A loss of $6,140. There aren't enough days in a calendar year to recoup that loss for OBC. 

 

 

 

21 hours ago, willoL said:

If OBC is the only reason a person buys his or her first shares of stock, at least they are investing. I think more people of modest means *should* be in the market. The only way to keep up with inflation is the do what the rich and powerful do; their interests will keep being protected. Thoughtful investments, I mean.

 

I agree with the highlighted. I fully retired at the age of 50 thanks largely to the NYSE. However; I do disagree that a persons of modest means should invest in the cruise industry at this time. It is, imo, extremely risky right now. No one knows how this will pan out considering the amount of debt the industry has taken on. By contrast, I strongly encourage everyone to get in the market, but perhaps choose a stock that has a better track record and brighter future.

 

Of course, if you are getting in to get the OBC and then cashing back out after your cruise (something I have been known to do on occasion lol) then by all means 100 shares is very modest investment with a high rate of return. If you believe in the company, it's time to jump in with both feet.  I'm not there. 

 

[gilboman]

On 7/22/2022 at 7:32 PM, rkacruiser said:

 

The difference has been the nationalities of the companies.

 

 

And, being required to employ Americans with the wage scale that had to be paid:  can one imagine the price of cruises that would need to be charged?  

 

 

Without knowing the exact details offered by various cruise lines, the choice between a cash refund and a FCC has caused me to wonder why one would not choose the "bird in hand"--cash.  I have a future cruise deposit somewhere on HAL's books that, I have been told that is refundable on demand or will be refunded after a period of time if I don't use it.  I am OK with that.  If I don't get it, I still have enough money in my bank account to pay for my next fill-up of gasoline.

 

 

The increase in the "hoops" that one has to transverse to travel will be a serious impediment to those who have the financial means and time to travel.  This ArriveCan nonsense is example #1.  

Arrivecan hadn't impeded travel based on volume and bookings though 

[strickerj]

On 7/22/2022 at 9:23 AM, DaveOKC said:

Backing up my previous comment - this from Market Watch:

 

Shares of Carnival Corp. CCL, -11.18% tumbled 11.2% in morning trading Thursday, to pace the S&P 500's SPX, +0.99% after the cruise operator caused investors to "panic" with its $1 billion public equity offering. The company said late Wednesday that the offering, which represented about about 10% of the current market capitalization of $9.79 billion, priced at $9.95 a share, or a 10.3% discount to Wednesday's closing price of $11.09. The offering comes after the stock had rocketed 27.3% amid a four-day win streak to close Wednesday at a six-week high. 

Thanks for sharing; this kind of backs up my initial reaction - I'm not an accountant or lawyer, but I don't understand how a publicly traded company can just issue more stock out of thin air. The market dictates the value of the company (market cap). In this case, that was about $11B at $11.09 per share.

 

Company announces $1B stock issuance, and the existing stock drops to $9.95 per share (roughly $1B total), bringing the total market cap to... still $11B, but effectively the company has just stolen $1B in equity from its shareholders. It's like printing money, except by a corporation rather than the government. I'd be rightfully miffed if I were still a shareholder.

[DaveOKC]

8 minutes ago, strickerj said:

Thanks for sharing; this kind of backs up my initial reaction - I'm not an accountant or lawyer, but I don't understand how a publicly traded company can just issue more stock out of thin air. The market dictates the value of the company (market cap). In this case, that was about $11B at $11.09 per share.

 

Company announces $1B stock issuance, and the existing stock drops to $9.95 per share (roughly $1B total), bringing the total market cap to... still $11B, but effectively the company has just stolen $1B in equity from its shareholders. It's like printing money, except by a corporation rather than the government. I'd be rightfully miffed if I were still a shareholder.

Well, issuing stock is certainly less expensive than borrowing the same $1 billion, which would cost them about $120,000,000 annually in interest expense.  Either way the shareholder gets hurt of course, but the stock issuing approach gives the company a better chance of surviving.

[strickerj]

Just now, DaveOKC said:

Well, issuing stock is certainly less expensive than borrowing the same $1 billion, which would cost them about $120,000,000 annually in interest expense.  Either way the shareholder gets hurt of course, but the stock issuing approach gives the company a better chance of surviving.

I can understand that; I just wonder if overdoing it would cause hesitation to buy among potential investors, that is, dilute the stock more than the amount of stock issued. I wouldn't buy any of this round of stock if I thought they were going to do it again every quarter.