Here is the paradox. Oil and natural gas inventories are rising . We have an abundance of supply and, yet, we are hearing all over the world that the real constraint the economy will face willI’m a long-term investor focused on U.S. and European equities, with a dual emphasis on undervalued growth stocks and high-quality dividend growers. Through years of experience, I’ve learned that sustained profitability—evident in strong margins, stable and expanding free cash flow, and high returns on invested capital ...

The FED seems under attack, and this time Jerome Powell wanted to clearly state that the DOJ is investigating him as "a consequence of the Federal Reserve setting interestI’m a long-term investor focused on U.S. and European equities, with a dual emphasis on undervalued growth stocks and high-quality dividend growers. Through years of experience, I’ve learned that sustained profitability—evident in strong margins, stable and expanding free cash flow, and high returns on invested capital—is a more reliable d ...

Core Insights - The market is expected to transition in 2026 from a liquidity-driven environment to one where cash flows, capital expenditure management, return on invested capital (ROIC), and pricing power become more significant [1] Group 1: Investment Strategy - The focus is on U.S. and European equities, particularly undervalued growth stocks and high-quality dividend growers [1] - Sustained profitability, characterized by strong margins, stable and expanding free cash flow, and high ROIC, is emphasized as a more reliable driver of returns than valuation alone [1] Group 2: Personal Investment Philosophy - The investment approach is influenced by a diverse academic background in Economics, Classical Philology, Philosophy, and Theology, enhancing both quantitative analysis and market narrative interpretation [1] - The motivation for investing is to ensure financial freedom for the investor and their family, allowing for the ability to work in a fulfilling manner rather than solely for financial necessity [1]

Core Insights - Carnival Corporation & plc (CCL) and Royal Caribbean Cruises Ltd. (RCL) are leading the recovery of the global cruise industry, benefiting from strong travel demand and record onboard spending trends [1] - Investors are evaluating which company presents a more attractive investment opportunity as the sector shifts from post-pandemic recovery to sustained profitability [2] Carnival Corporation (CCL) - CCL's third-quarter fiscal 2025 results indicate strong performance with record revenues, net income, and yields, alongside impressive onboard spending [3] - Customer deposits reached a new high in Q3 fiscal 2025, indicating strong booking momentum and pricing power for 2026 [4] - The company is improving its financial position, reducing leverage to 3.6x and approaching investment-grade metrics, which may lead to dividends and buybacks [4] - CCL's commercial initiatives, including exclusive destinations and a multi-brand strategy, are enhancing ticket prices and guest experiences [5] - Despite progress, CCL faces challenges such as high net interest expenses and ongoing leverage reduction efforts, with potential margin pressures from a new loyalty program and increased operational costs [6] Royal Caribbean Cruises Ltd. (RCL) - RCL is capitalizing on a strong global demand for leisure travel, with high guest satisfaction and robust booking trends for 2025 and 2026 [7] - The company is achieving margin growth through cost discipline and technology efficiencies, expecting minimal cost growth while expanding destination offerings [8] - RCL is focusing on its competitive advantages, including innovative ships and exclusive destinations, which are driving onboard revenue [9] - However, RCL anticipates challenges such as increased fuel costs, regulatory expenses, and structural costs from new destination rollouts [12] Financial Performance and Valuation - The Zacks Consensus Estimate for CCL indicates fiscal 2026 sales and EPS growth of 4.3% and 10.8%, respectively, with upward revisions in earnings estimates [13] - RCL's estimates imply year-over-year growth of 9.4% in sales and 14.5% in EPS, but have seen downward revisions recently [14] - RCL's stock has increased by 10% over the past six months, while CCL's shares have risen by 19.4% [15] - CCL's forward P/E ratio is 11.09X, below its median of 12.96X, while RCL's is 14.94X, below its median of 18.13X [20] Conclusion - CCL appears to offer a more compelling investment opportunity due to its operational turnaround, improving financial health, and strong stock momentum [18] - Both companies are positioned well in the market, with CCL focusing on enhancing destinations and yield, while RCL maintains strong demand trends [21]

Group 1 - The US housing market is experiencing a crisis characterized by stagnant home prices, high mortgage rates, and declining existing home sales, indicating that the market is not crashing but is in a slow state of recovery [1] - The focus on sustained profitability, including strong margins, stable and expanding free cash flow, and high returns on invested capital, is emphasized as a more reliable driver of returns compared to valuation alone [1] - The investment strategy includes a dual emphasis on undervalued growth stocks and high-quality dividend growers, reflecting a long-term investment approach [1] Group 2 - The analyst has no current stock or derivative positions in the companies mentioned but may initiate a long position in the near future, indicating potential interest in specific stocks [2] - The article expresses personal opinions of the analyst and does not represent any business relationship with the companies mentioned, highlighting an independent perspective [2]

Core Insights - The article discusses the investment strategy focused on undervalued growth stocks and high-quality dividend growers, emphasizing the importance of sustained profitability over mere valuation [1]. Group 1: Investment Strategy - The investment approach prioritizes companies with strong margins, stable and expanding free cash flow, and high returns on invested capital as reliable drivers of returns [1]. - The author manages a portfolio on eToro, allowing others to follow real-time investment decisions, indicating a transparent investment strategy [1]. Group 2: Personal Investment Philosophy - The investment philosophy is rooted in ensuring financial freedom for the author's family, aiming for a balance where there are enough assets to allow for personal expression and choice in work [1].

Group 1 - The article emphasizes the importance of sustained profitability, which is characterized by strong margins, stable and expanding free cash flow, and high returns on invested capital, as a more reliable driver of returns than valuation alone [1] - The author manages a portfolio on eToro, where they have achieved the status of Popular Investor, allowing others to replicate their investment decisions in real-time [1] - The author's interdisciplinary background in Economics, Classical Philology, Philosophy, and Theology enhances both quantitative analysis and the interpretation of market narratives from a long-term perspective [1] Group 2 - The author began investing with the goal of ensuring financial freedom for themselves and their children, aiming for a balance where they have enough assets to pursue desired activities without being burdened by excessive wealth [1] - The focus is on long-term investment strategies in U.S. and European equities, particularly in undervalued growth stocks and high-quality dividend growers [1]

Core Insights - The article emphasizes the importance of sustained profitability as a more reliable driver of returns compared to valuation alone, highlighting strong margins, stable and expanding free cash flow, and high returns on invested capital as key indicators [1]. Investment Philosophy - The focus is on long-term investment strategies in U.S. and European equities, particularly undervalued growth stocks and high-quality dividend growers [1]. - The investment approach is informed by an interdisciplinary background in Economics, Classical Philology, Philosophy, and Theology, which enhances both quantitative analysis and market narrative interpretation [1]. Personal Investment Journey - The motivation for investing began with the desire to provide for future generations, aiming for a balance between financial security and the freedom to pursue personal interests [1].

Group 1 - The article emphasizes the importance of sustained profitability, which is driven by strong margins, stable and expanding free cash flow, and high returns on invested capital, rather than valuation alone [1] - The author manages a portfolio on eToro, where they are recognized as a Popular Investor, allowing others to follow their investment decisions in real-time [1] - The author's interdisciplinary background in Economics, Classical Philology, Philosophy, and Theology enhances their quantitative analysis and market narrative interpretation [1] Group 2 - The author started investing with the goal of ensuring financial freedom for their family, aiming to have enough assets to choose how to work rather than being free from work [1]

Group 1 - The discussion includes both macroeconomic factors and specific stocks such as Norfolk Southern (NSC), Caterpillar (CAT), and Duke Energy (DUK) [1] - The focus is on long-term investment strategies in U.S. and European equities, emphasizing undervalued growth stocks and high-quality dividend growers [2] - Sustained profitability, characterized by strong margins, stable and expanding free cash flow, and high returns on invested capital, is highlighted as a more reliable driver of returns than valuation alone [2] Group 2 - The analyst has a beneficial long position in the shares of NSC and CNI through stock ownership, options, or other derivatives [3] - The article expresses the author's own opinions and is not compensated for it, aside from Seeking Alpha [3] - Seeking Alpha clarifies that past performance does not guarantee future results and does not provide specific investment recommendations [4]