Short City Update: Carnival Corp., Royal Caribbean: all stopped out

Posted Sep 15th 2009 4:20PM by Joseph Lazzaro
Filed under: Carnival Corp (CCL)

You can't win them all. The May 14, 2009 Shorts of both Carnival Corp. (NYSE: CCL), at $25.56 and Royal Caribbean Cruises (NYSE: RCL), at $14.45 were Stopped Out.

Each is a major cruise line that's battling domestic and international macroeconomic headwinds, overcapacity, stagnant-to-lower U.S. disposable income for many U.S. employment segments, and the sector's latest concern: the H1N1 virus that has discouraged some citizens from taking vacations in large-gathering, contained surroundings.

The fundamentals suggest a downward price movement for each. It did not happen, underscoring how a stock can move against you, even when the analytics and sector/macro conditions signal otherwise.

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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.

Tags: CCL, cruise ships, CruiseShips, RCL, shorting, travel

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Reader Comments (Page 1 of 1)

9-15-2009 @ 5:11PM

Ronald Framson said...

Too bad that you don't understand the business - serves you right. I can more than offset your negatives with many more positives. You have no idea what is happening in the cruise industry. In every downturn, it has proved itsdelf over and over again.

Ron