Benzinga·2026-03-13 14:32Group 1: Carnival Corp Overview - Carnival Corp (NYSE: CCL) is experiencing a 3% increase today, but the stock is down 22% this month, with Brent crude trading over $90 [1] - Carnival is the only major cruise operator that does not hedge its fuel purchases, relying on consumption efficiency to manage fuel risk [1] - CFO David Bernstein indicated that the company's strategy saved money when oil was at $65, but it is less effective now [1] Group 2: Competitor Analysis - Royal Caribbean Cruises (NYSE: RCL) and Norwegian Cruise Line Holdings (NYSE: NCLH) hedge the majority of their fuel exposure, with RCL down 3% this year and NCLH down 14% [2] - Analyst Sharon Zackfia estimates that the oil spike could reduce Carnival's full-year earnings per share by approximately $0.20 [2] Group 3: Market Predictions and Reactions - Goldman Sachs has reduced its price target for CCL from $34 to $30, while Stifel lowered its target from $40 to $35 but maintained a Buy rating [2] - Prediction markets indicate a 29% chance that oil prices will retreat to $80 and a 10% chance they will hit $70 this month [3] Group 4: Geopolitical Context - Since the war began on February 28, thirteen ships have been attacked, and Iran's IRGC has stated it will not allow oil to pass for the benefit of the U.S. and its allies [4] - The U.S. recession contract on Polymarket has increased from 21% in February to 34% now [4] Group 5: Upcoming Earnings and Expectations - Carnival is set to report Q1 earnings on March 20, with Wall Street expecting $0.18 EPS on approximately $6.1 billion in revenue, guidance established before the recent oil price surge [5] - Investors should not expect a sudden change in Carnival's fuel strategy, as locking in prices now would be unfavorable [5] Group 6: Future Considerations - A key question for the future is whether Carnival will lock in cheaper fuel if oil prices eventually retreat or repeat its current strategy [6]