Carnival (NYSE) (CCL), as well as the wider cruise line market, has struggled to rebound from the COVID-19 collapse.

While many shares are up more than they were pre-pandemic, it has been difficult for cruise companies to navigate the rough waters.

Carnival has seen a modest improvement in COVID numbers over the past year.

However, we don’t know when the pandemic will reach its endemic phase. Carnival has the potential to improve its operation amid COVID. Therefore, I’m bullish. TipRanks has Carnival stock charts.

Risky Bet

Any locales that attempted to declare COVID an endemic are now regretting their decision. Over the next year, more variants are possible. Cruise lines remain uncertain because they represent one of the most risky reopening stocks.

With the introduction of an innovative COVID treatment such as the oral treatment currently under development by Comirnaty COVID-19, this could all change. Pfizer (NYSE:). This breakthrough may propel the cruise-line stocks vertically in a very short period of time.

Even if the pill was approved next year, it’s not clear if some groups will be interested in taking it. Investors must exercise caution when betting on the parabolic movement in Carnival’s name, regardless of the return to cruising.

Continued Improvements

Last week’s news of an earlier-than-expected return of the brand-new Seabourn Encore cruise ship bodes well for operations amid COVID.

Carnival’s balance sheet has been strengthened by the sale of several cruise ships that are no longer in service. With a current and quick ratio of 1.2, Carnival’s liquidity has increased and its solvency is assured.

Carnival is on track to cruise to its pre-COVID peak. Bookings for Carnival are increasing and there is more demand than expected between the COVID waves.

The recovery is finally on the horizon, but new varieties and future waves might stall it.

Wall Street Take

CCL stock is rated a Hold by TipRanks consensus analyst rating. There are eight analyst ratings. Three Buy recommendations, two Hold suggestions, and three Sell recommendations.

The average Carnival price target is $28.04. The average price target for Carnival is $28.04.

Bottom line

Analysts aren’t expecting smooth sailing with Carnival stock. There will be as many Buys and Sells.

For those who are optimistic about cruising being able to function in the new norm, it may be too risky for them not to consider Carnival as a viable cruise line.

Disclosure: Joey Frenette is not a shareholder in any of the mentioned companies at publication.

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