Is 2026 the Big Payoff Carnival Cruise Investors Have Waited For?

Core Viewpoint - Carnival Corp. has made a significant recovery from the pandemic, achieving record-breaking numbers in revenue, bookings, and operating profits in Q3 2025 [1] Group 1: Financial Performance - Carnival's stock has underperformed compared to the S&P 500, returning only 2.3% in 2025 against the index's 16.4% [2] - The company has paid down billions in long-term debt over the past few years, improving its financial standing [4] - Carnival has booked approximately half of its 2026 capacity as of Q3 2025, indicating strong demand despite economic challenges [10] Group 2: Credit Rating and Future Outlook - Carnival's credit rating has improved, with upgrades from Moody's to Ba2 in Q3 2025, just two upgrades away from investment-grade status [7] - Achieving investment-grade credit could allow Carnival to refinance debt at better terms, further enhancing its financial flexibility [8] - The potential for improved credit ratings and strong business performance could make 2026 a pivotal year for Carnival's stock [12] Group 3: Market Dynamics - The current economic climate has not deterred Carnival's performance, as consumers may be prioritizing experiences over other expenditures [11] - High earners may be opting for Carnival as a more affordable vacation option, contributing to the company's strong performance [11]