Short-Term Headwinds Won‘t Alter The Course; Reiterate Buy

Research evidence excerpt

Short-Term Headwinds Won‘t Alter The Course; Reiterate Buy

19B prior) and Adj. EPS of $2.22 (vs. $2.21 prior), which compares to our $7.05B and

$2.11 and consensus $7.21B and $2.23.

Things we learned on the call. 1) While demand was choppy in 2Q26 due the Iran war, trends have

rebounded somewhat in June; 2) CCL continues to find efficiency both on fuel and non-fuel costs;

3) Ship refurbishment at AIDA is going well, with CCL bringing the program to Holland America next,

likely in 2H27; 4) CCL is confident that it can continue to reduce leverage, invest in organic growth,

and return capital to shareholders simultaneously, with our estimates assuming ~$3.5B in total

capital returns in 2H26+FY27 with leverage of 2.9x at YE27 net of ~$4.8B in FY27 CAPEX.

Refining Estimates; Price Target Remains $35. We are tweaking estimates to directionally account

for CCL's guide-down on yields, with our revenue moving lower, while also providing benefit for

lower fuel and non-fuel costs, netting a more favorable margin. We note that our estimates are

modestly above guidance given CCL's strong track record of beats since 1Q25. For FY26 and FY27,

our revenue estimates are now $27.6B and $28.8B vs. $27.9B and $29.0B prior, and our Adj. EBITDA

estimates are now $7.17B and $7.90B vs. $7.05B and $7.78B prior. We believe the financial positive

pivot continues in a reasonable range of circumstances and valuation improves over time. We value

CCL on 9.0x FY26/FY27E EV/EBITDA, 15.0x P/E, and 10.5x P/FCF, as well as our five-year DCF. Net

of the changes to our estimates, our price target remains $35. Reiterate Buy. David Katz * | Equity Analyst

+1 (212) 323-3355 | dkatz@jefferies.com

FY (Nov) 2025A 2026E 2027E Anthony Berni, CFA * | Equity Associate

+1 (646) 805-5496 (office) | aberni@jefferies.com