Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTNeil Patel, The Motley FoolFri, July 3, 2026 at 10:37 PM GMT+2 4 min readCompanies that investors wouldn't touch with a 10-foot pole during the COVID-19 pandemic are now starting to look like attractive opportunities. This is precisely how to describe the situation with Carnival (NYSE: CCL). The leading cruise line operator was decimated at the start of this decade. But it's now sailing in much smoother water.It's time for investors to get on board. Here are three reasons you should consider buying this travel stock in July.Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »Image source: The Motley Fool.1. Demand tailwindsThe first reason to add this business to your diversified portfolio is demand trends. Since the cruise industry was temporarily devastated starting in 2020, as operations were halted to stop the spread of the virus, Carnival has experienced a resurgence. Its sales in Q2 2026 (ended May 31) were 5.3% higher than in the same period of fiscal 2025. That top-line figure was a record, as were customer deposits of $9 billion.Looking ahead, the industry is well-positioned to benefit from powerful tailwinds. The cruise market is attracting not only first-time cruise passengers but also a younger demographic. Moreover, cruise trips are viewed as offering a much better value proposition than land-based alternatives.And lastly, the cruise industry accounts for only about 2% of the entire global tourism market. This leaves a lot of untapped potential to acquire new customers. Given Carnival's growth plan to expand its fleet and provide service to new destinations, it's looking to capitalize on these trends.2. Cleaner financialsCarnival's improving financial picture is the second reason to buy shares. The business was forced to take on additional debt to navigate the COVID-19 pandemic. Its debt burden peaked at $35.1 billion in the first quarter of 2023.However, management has made it a priority to clean up the balance sheet. As of May 31, Carnival had $24.9 billion in long-term debt, down almost 7% year over year. In late June, S&P Global upgraded the company's credit rating to investment grade, a vote of confidence for Carnival's financial standing.The company is being helped by its growing earnings stream. Operating income in fiscal 2025 of $4.5 billion was 25% higher than the year before. And free cash flow totaled $2.5 billion over the last six months, ensuring the company has resources to continue paying down debt.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info