"If you think filling up an SUV is painful, try footing the bill for a massive 1,000-foot ocean liner -- or in the case of Carnival Corp. (NYSE: CCL), an entire fleet of 84 floating cities," notes value investor Nathan Slaughter.

In his Half-Priced Stocks he explains, "Despite unprecedented fuel costs, the company continues to power forward." Here's his bullish review.

"Last quarter, Carnival shelled out $530 per metric ton for fuel, up sharply from $330 per ton a year ago. And after pumping about 800,000 metric tons, the company rang up a total fuel bill of $425 million.

"For the year, management is expecting fuel costs to come in about $750 million higher than in 2007, which will trim earnings by about $0.92 per share. Fortunately, the company is in a position to absorb those higher costs.

"Over the past three months, two million passengers have boarded a Carnival ship, for an occupancy rate of 104.8% (indicating some berths held more than two guests). And those visitors paid $2.6 billion for their tickets and plunked down another $743 million in the lounges, casinos and gift shops after they arrived on board.

TheStreet.com's Jim Cramer says this is a crucial moment for the dividend-payers, which should be getting support here.

You can't even find protection in yields these days. It just went away. Perhaps we will get it if Sen. Obama gets elected. Perhaps with higher rates. Perhaps with the downfall of the high-yielding American financials. (Nice discussion of the lack of dividend safety courtesy of the man who knows more about dividends than anyone, Dave Peltier, in the Columnist Conversation last week.)

For ages, it seemed you could get to a magic number, typically 4% yield, where stocks would bounce, or at least be given a parachute that opened for a gentle landing.

Last week that parachute failed. You have stocks like Con Ed (NYSE: ED) (Cramer's Take) just getting trashed here, pushing the yield to 6%. You have stocks like Weyerhauser (NYSE: WY) (Cramer's Take), Carnival Cruise (NYSE: CCL) (Cramer's Take), Gannett (NYSE: GCI) (Cramer's Take), just slicing through the protection. The former's got cyclicality, the middle's got consumer and fuel worries, and the latter is in secular. But they all have no trouble paying the dividend.

Or consider Verizon (NYSE: VZ) (Cramer's Take) and AT&T (NYSE: T) (Cramer's Take). The first is at a 5% yield, the other is almost there. No one questions their ability to support that dividend.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Best Buy Inc. (NYSE: BBY) beat Q1 estimates as consumers spent their government stimulus checks.
• Carnival Corp. (NYSE: CCL) posted better than-expected Q2 results but offered cautious Q3 guidance.
• Cyberonics Inc. (NASDAQ: CYBX) beat Q4 expectations and offered full-year guidance.
• FactSet Research Systems (NYSE: FDS) had better-than-expected Q3 results and 500 new subscribers.
• General Mills Inc. (NYSE: GIS) raised its full-year guidance, sending shares up near the 52-week high.
• Goldman Sachs Group Inc. (NYSE: GS) results beat the previous quarter and analysts' estimates.
• John Wiley & Sons Inc. (NYSE: JW.A) doubled its Q4 earnings due to an acquisition.
• Life Partners Holdings Inc. (NASDAQ: LPHI) lifted its Q1 outlook after "best quarter" in company history.
• Lindsay Corp. (NYSE: LNN) Q3 profits nearly doubled, but the share price plunged anyway.
• Meade Instruments Corp. (NASDAQ: MEAD) narrowed its full-year net loss due to restructuring.
• Pall Corp. (NYSE: PLL) beat Q1 expectations on sales growth that was broadly based across markets.
• Titan Machinery Inc. (NASDAQ: TITN) beat Q1 estimates on strong demand for agricultural equipment.
• Vermont Pure Holdings Ltd. (AMEX: VPS) posted strong Q2 results despite a bad debt write-off.
• Western Union Co. (NYSE: WU) said 2008 profits would beat estimates and announced share buyback.

More earnings highlights from this week: Morgan Stanley, FedEx, Ford, GE, Circuit City and others

Carnival Corp. (NYSE: CCL), a provider of cruise vacations and competitor of Royal Caribbean (NYSE: RCL), issued its Q2 earnings numbers on Thursday. Revenues rose more than 16% to $3.4 billion. Net earnings were 49 cents a share. That wasn't too impressive, considering that it was a penny better than the previous year's quarter. However, according to Briefing.com, Carnival killed the earnings expectations of analysts by 8 cents. Net sales were also higher than what Wall Street's expectations.

This performance sent the stock up more than 5%. I think investors need to be a little careful here because Carnival's management has become cautious about the next quarter because of energy costs. The company expects earning of $1.56 to $1.58 per share in Q3. Last year's Q3 saw bottom-line income of $1.67 per share. So, growth will not be found in next quarter's report.

Yet, again, the market didn't seem to mind, as it was high off the expectations-beating data. Is Carnival, therefore, a buy? Well, I don't think it's overly expensive considering the P/E ratio and the yield attached to the stock. But the direction of oil prices has me concerned. Not only will that increase costs for Carnival, but it will compete with the discretionary dollars of potential vacationers. I see the valuation case, but the current state of the market makes me reluctant to pull the trigger on this stock. Some would argue that all this is baked into the shares since they did so well yesterday, but I'm not convinced.

Disclosure: I don't own any company mentioned here; positions can change at any time.

Before the bell: Futures mixed after selloff

Coventry Health (NYSE: CVH) shares were down nearly 17% in after-hours trading Wednesday after the managed-care provider lowered estimates for second-quarter and full-year earnings due to disappointing April and May results. Wachovia downgraded CVH to Market Perform from Outperform. Other healthcare stocks felt the pressure and were down in after-hours or premarket trading: UnitedHealth (NYSE: UNH) -7%, Aetna (NYSE: AET) -9.9%, WellPoint (NYSE: WLP) -6%, Humana (NYSE: HUM) -5% and Cigna (NYSE: CI) -5%.

MOST NOTEWORTHY: Carnival, Royal Caribbean, BankUnited and Royal DSM were today's noteworthy downgrades:

• ABN downgraded shares of Carnival Corp. (NYSE: CCL) to Hold from Buy and Royal Caribbean Cruises (NYSE: RCL) to Sell from Buy as they believe the slowing economy will drive slower demand over the next 12 months.
  
• Suntrust downgraded BankUnited (NASDAQ: BKUNA) to Neutral from Buy citing the company's intention to raise the number of Class A Common Stock to 500M from 200M.
  
• Royal DSM (OTC: RDSMY) was downgraded to Neutral from Buy at Goldman on valuation following the recent rally.

OTHER DOWNGRADES:

• WebMD (NASDAQ: WBMD) was downgraded to Sell from Neutral at Goldman.
  
• Platinum Underwriters (NYSE: PTP) was cut at JP Morgan to Underweight from Neutral.
  
• UBS cut Methanex (NASDAQ: MEOH) to Neutral from Buy.
  
• Infosys Technologies (NASDAQ: INFY) was lowered at Susquehanna to Neutral from Positive.

Carnival (NYSE: CCL) is scheduled to report Q2 EPS on June 19. CCL closed at $36.22 Monday, near 54-month low. CCL June 35 straddle is priced at $2.35. CCL July option implied volatility of 41 is above its 26-week average of 36 according to Track Data, suggesting larger price movement.

Circuit City (NYSE: CC) is scheduled to report Q1 EPS on June 19. CC closed at $4.31 Monday. CC June 5 straddle is priced at 90c cents. CC over all option implied volatility of 78 is near its 26-week average according to Track Data, suggesting non-directional price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Solarfun Power (NASDAQ:SOLF) is up 19% on good earnings.

Adolor (NASDAQ:ADLR) is up 19% after getting approval for marketing of one of its drugs.

Red Robin Gourmet (NASDAQ:RRGB) is down almost 7% on poor earnings.

Carnival (NYSE:CCL) is off 3.5% without any visible news.

Stocks may trade differently in the pre-market than they do in the regular session.

Douglas A. McIntyre is an editor at 247wallst.com.

Carnival Corp. (NYSE: CCL) shares are falling after company CEO Mickey Arison said at an annual shareholders meeting that the company will pay an extra $600 million this year for fuel. He also added that the recently-increased $7-a-day fuel charge the company charges its passengers will only pay 25 to 40 percent of those costs. The June crude oil contract is also near record levels again today, and is currently at $118, which is not helping CCL. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on CCL.

After hitting a one-year high of $52.10 in October, the stock hit a one-year low of $36.10 in March. This morning, CCL opened at $39.29. So far today the stock has hit a low of $38.95 and a high of $39.81. As of 12:55, CCL is trading at $39.12, down $1.19 (-3.0%). The chart for CCL looks deteriorating slightly, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bearish hedged play on this stock, I would consider a June bear-call credit spread above the $45 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in two months as long as CCL is below $45 at June expiration. Carnival would have to rise by more than 15% before we would start to lose money. Learn more about this type of trade here.

Carnival Corp. (NYSE: CCL) shares are trading higher today even though CCL announced yesterday after market close that it will refund $40 million to customers who were assessed a fuel surcharge after booking trips on the cruise line. Despite this massive rebate, CCL shares are rising today, showing that what really matters for companies like this are lower oil prices, which mean lower fuel costs. Front-month crude today has reached as low as $99.55 and are currently just above $100. If you think that the company won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on CCL.

After hitting a one-year high of $52.10 in October, the stock hit a one-year low of $36.10 last month. CCL opened this morning at $41.06. So far today the stock has hit a low of $41.06 and a high of $43.00. As of 11:50, CCL is trading at $42.70, up $2.22 (5.5%). The chart for CCL looks bullish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

For a bullish hedged play on this stock, I would consider a May bull-put credit spread below the $35 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 5.3% return in just 7 weeks as long as CCL is above $35 at May expiration. Carnival would have to fall by more than 17% before we would start to lose money. Learn more about this type of trade here.

The choppy/consolidating (or perhaps worse) market conditions sometimes give the impression that growth plays do not exist, but that is not the case, and one growth company worth reviewing is Carnival Corp.

Carnival Corporation (NYSE: CCL) is the world's largest recreational cruise ship company.

Analysts expect adequate revenue gains for CCL in 2008, primarily on increased capacity. Larger booking increases are expected in Europe, as opposed to North America, which may begin to show the effects of the U.S. economic slowdown. As of first quarter 2008, Carnival had 85 ships with a passenger capacity of 158,000.

Meanwhile, cruise prices should rise modestly, and a likely fuel surcharge will ease the impact of higher fuel costs. Further, analysts also like CCL's rising demand for Caribbean cruises, along with the company's leading market share in leisure cruises. The Reuters FY 2008/FY 2009 EPS consensus estimates for CCL are $3.09 to $3.40.

MOST NOTEWORTHY: Atmel, Skyworks, Alcatel-Lucent, Parexel and Map Pharma were today's noteworthy initiations:

• Kaufman Bros. initiated Atmel (NASDAQ: ATML) with a Buy rating and $6 target, as they believe the company's increasing focus around its core microcontroller business can drive an improved growth and profitability profile going forward and would be buyers at current levels.
  
• The firm also started shares of Skyworks (NASDAQ: SWKS) with a Buy rating and a $10 target, as they like the company's balanced customer positioning and find the stock attractively valued at current levels.
  
• JP Morgan initiated Alcatel-Lucent (NYSE: ALU) with an Overweight rating and believes the risks are more than fully priced into shares at current levels.
  
• Parexel (NADSAQ: PRXL) was initiated with a Neutral rating at Broadpoint, as they believe the company's improved execution is already priced into shares.
  
• Deutsche Bank finds shares of Map Pharmaceuticals (NASDAQ: MAPP) attractively valued given the opportunity from the company's two late stage product candidates, UDB and Tempo Migraine. The firm started shares off with a Buy rating and $19 target.

OTHER INITIATIONS:

• Wachovia initiated coverage of leisure stocks, starting shares of Carnival (NYSE: CCL), Cedar Fair (NYSE: FUN) and Royal Caribbean (NYSE: RCL) with Outperform ratings.
  
• Credit Suisse initiated PepsiCo (NYSE: PEP) and Coca-Cola (NYSE: KO) with Outperform ratings and targets of $87 and $68, respectively.

MOST NOTEWORTHY: Select newspaper stocks and Dolan Media were today's noteworthy initiations:

• Banc of America initiated six stocks in the newspaper sector with Neutral ratings: Gannett (NYSE: GCI) was started with a $51.50 target, citing a lack of clarity into the company's acquisition strategy; New York Times (NYSE: NYT) was started with a $21 target, reflecting a lack of clarity into the company's acquisition strategy; E.W. Scripps (NYSE: SSP) was started with a $43 target, as the firm feels the company's Interactive division is a "big question mark" that could drag down company growth; McClatchy Co (NYSE: MNI) was started with a $26 target, as the firm is positive longer-term, but sees downside risk to 2007 consensus estimates; Lee Enterprises (NYSE: LEE) was initiated with a $19.50 target; Gatehouse Media (NYSE: GHS) was started with a $12.50 target.
  
• Dolan Media (NYSE: DM) was initiated with an Outperform rating and $24 target at Piper Jaffray. Piper believes DM's Q3 guidance is conservative given the default rates in July and August and notes the company processes defaults in two of the three highest default rate states. Dolan Media was also started with a Buy rating and $26 target at Merrill Lynch and with a Buy rating and $28 target at Craig-Hallum.

OTHER INITIATIONS:

• Think Equity assumed coverage of Intel Corporation (NASDAQ: INTC) and Micron Technology (NYSE: MU) with an Accumulate rating and $26 target and a Buy rating and $18 target, respectively.
• Citigroup started shares of Royal Caribbean Cruises (NYSE: RCL) and Carnival Corp (NYSE: CCL) with Hold ratings.
• SuperValu Inc (NYSE: SVU) was started with a Hold rating and $47 target at Citigroup.
• Rodman & Renshaw initiated shares of Omrix Biopharmaceuticals (NYSE: OMRI) with a Market Outperform rating.