Should You Forget Carnival Corp Stock? Why You Might Want to Buy This Unstoppable Growth Stock Instead.

Despite Carnival's scale—roughly 42% of industry passengers, about 36% of revenue, record bookings, 112% cabin occupancy in the latest quarter and a low P/E of ~14—Viking's May 2024 IPO highlights a differentiated premium strategy (all-adult, all-inclusive small ships and river cruises) that targets higher-income customers. Viking posted >$4.4bn revenue in the first nine months (up ~20% y/y), operating income +35% in the first three quarters of 2025 and $848m net income versus $49m a year earlier, supporting a higher P/E (~31) but rapid profitability; however it carries ~$5.6bn of debt against $804m of book value, though interest costs fell to ~ $1bn after refinancing and shipbuilding commitments rose to $4.5bn to fund expansion. On balance, Viking’s pricing power, faster growth and lower cyclicality present a compelling long-term equity case relative to Carnival despite higher leverage and valuation, while Carnival remains an attractively valued industry leader.

Analysis

Carnival remains the industry scale leader with roughly 42% of passengers and about 36% of industry revenue, reporting record bookings, all-time highs in net income and a reported 112% cabin occupancy in the most recent quarter; its trailing P/E of ~14 is in line with Norwegian and materially below Royal Caribbean (17x) and Viking (31x), positioning Carnival as a value-oriented, high-share play. Viking, which launched its IPO in May 2024, differentiates through all-adult, all-inclusive small-ship and river-cruise experiences that limit cabins to two passengers (96% occupancy) and target higher-income customers, enabling pricing power and lower cyclicality. Viking’s financial momentum is pronounced: revenue for the first nine months exceeded $4.4 billion, up ~20% year-over-year, operating income rose 35% in the first three quarters of 2025, and net income reached $848 million versus $49 million a year earlier. The principal constraint is leverage and capex commitments: total debt is just under $5.6 billion against $804 million in book value (up from $5.2 billion), interest expense fell to slightly above $1.0 billion after Q3 refinancing, and shipbuilding obligations rose to $4.5 billion, supporting growth but raising refinancing and execution risk while justifying Viking’s premium multiple relative to Carnival’s cheaper, scale-driven profile.

Key Decisions for Investors

• Consider a growth-oriented allocation to VIK to capture premium pricing and rapid profitability given revenue +20% y/y and operating income +35%, but size positions conservatively because of nearly $5.6bn debt and $4.5bn in shipbuilding commitments
• Monitor Viking’s interest expense and refinancing progress closely (interest fell to ~ $1bn after Q3 refinancings) and be prepared to trim VIK exposure if debt metrics deteriorate or refinancing costs rise
• Use CCL as a value/defensive complement given its 42% passenger share, record bookings and low P/E (~14); consider it for income/scale exposure or as a hedge against luxury-segment cyclicality
• Watch quarterly booking and occupancy trends for both names and any updates to shipbuilding/expansion schedules as leading indicators that will shift the relative risk/reward between Carnival and Viking