UBS Warburg on Tuesday cut its earnings estimates for the cruise operators it covers, including Royal Caribbean and Carnival Corp.
A UBS analyst cut the full-year 2001 earnings estimate for Royal Caribbean to $1.87 from $2.21, and lowered the 2002 estimate to $2 from $2.36. Farley assigned Royal Caribbean shares a 12-month price target of $23, down from $27.
The analyst lowered estimates on Carnival Corp. to $1.74 from $1.78 for 2001 and $1.96 from $2.00 for 2002.
"We believe that the stock's recent weakness already reflects concerns about the economy and particularly given that we expect the stock will take a hit in Tuesday's trading, the risk/return at these levels still makes the stock attractive, in our view. We continue to believe that the long-term growth of CCL makes the stock attractive," the analyst said
in a research note.
Shares of Royal Caribbean closed
at $21 in New York Stock Exchange trading
on Monday, while those of Carnival closed at $27.32.