Susquehanna analyst Christopher N. Stathoulopoulos maintained a positive rating on the shares of Carnival Corp (NYSE:CCL) with a price target of $17.00.

The cruise liner is slated to report third-quarter FY23 earnings on September 29, kicking off the 3Q earnings season for Travel & Leisure.

With another upward revision to FY23 guidance unlikely and a well-articulated multi-year guide in the rear-view, progress towards CCL’s FY26 targets is what matters, said the analyst.

Recent updates from ultra-low-cost carriers Spirit Airlines Inc (NYSE:SAVE) and Frontier Group Holdings Inc (NASDAQ:ULCC) suggest sub-seasonal demand into September, noted the analyst.

Given growing concerns that leisure demand might be slowing, the analyst will focus on onboard spend, pre-cruise packages, and FY24 volumes and yields. 

That said, advertised fares for CCL remain healthy, with the longer booking curve for cruise travel an important nuance to consider when gauging travel demand, opined the analyst.

The analyst does not see any evidence of slowing demand or softening prices but does acknowledge that any perceived slowing could pressure CCL’s stock.

The upside catalysts include stronger-than-expected performance in net yields, a sustained decline in Brent crude oil and marine fuel prices, the resolution of the RussiaUkraine conflict, rising vaccination rates for CV-19, and the easing of travel restrictions.

Price Action: CCL shares are trading lower by 0.55% at $14.57 on the last check Thursday.