Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTProactiveWed, June 24, 2026 at 9:37 PM GMT+2 2 min readCarnival faces near-term headwinds, but long-term outlook remains intact, says Jefferies Proactive uses images sourced from ShutterstockCarnival Corp (NYSE:CCL)'s reduced fiscal 2026 guidance reflects near-term pressures rather than a change in its longer-term trajectory, according to Jefferies analysts, who reiterated a 'Buy' rating and maintained a $35 price target on the cruise operator's shares.Shares of Carnival traded hands at about $29 on Wednesday afternoon, down about 5% this year.Jefferies believes that Carnival's trimmed yield outlook is unlikely to derail what it views as a multi-year improvement story driven by margin expansion and more than $9 billion in free cash flow generation expected between fiscal 2026 and 2027.The firm wrote that the level of cash generation should support organic growth investments, debt reduction and shareholder returns.The analysts also noted that Carnival has exceeded its guidance for net yields, adjusted EBITDA and adjusted earnings per share in every quarter since the first quarter of 2025, suggesting the company's latest outlook could prove conservative.Carnival lowered its fiscal 2026 net yield growth forecast to 3.2% from 4.1% previously. The company now expects adjusted EBITDA of about $7.11 billion, down slightly from its prior estimate of $7.19 billion, while adjusted earnings per share are projected at $2.22, compared with earlier guidance of $2.21.For the third quarter of fiscal 2026, Carnival expects net yields to rise 1.3% year over year and adjusted EBITDA of $2.88 billion, both below Jefferies' prior estimates and Wall Street expectations.According to Jefferies, management said demand was uneven during the second quarter because of the conflict involving Iran, though booking trends improved in June. Carnival also reported continued efficiencies in both fuel and non-fuel costs.The company said refurbishment work on ships within its AIDA Cruises brand is progressing as planned, with a similar program expected to be extended to Holland America Line in the second half of 2027.Jefferies noted that Carnival remains confident it can continue lowering leverage while investing in growth initiatives and returning capital to shareholders. The firm estimates the company could deliver roughly $3.5 billion in capital returns during the second half of fiscal 2026 and fiscal 2027 while reducing leverage to 2.9 times by the end of fiscal 2027.Jefferies modestly lowered its revenue forecasts to reflect weaker yield assumptions but raised its adjusted EBITDA estimates to account for lower fuel and operating costs. The brokerage now projects fiscal 2026 revenue of $27.6 billion and adjusted EBITDA of $7.17 billion, compared with previous estimates of $27.9 billion and $7.05 billion, respectively.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info