Critical Review: Carnival (NYSE:CCL) vs. Flight Centre (OTCMKTS:FGETF)

Flight Centre (OTCMKTS:FGETF) and Carnival (NYSE:CCL) are both consumer discretionary companies, but which is the better business? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, dividends and analyst recommendations.

Insider and Institutional Ownership

67.2% of Carnival shares are owned by institutional investors. 7.9% of Carnival shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Earnings & Valuation

This table compares Flight Centre and Carnival”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Flight Centre	$1.80 billion	1.01	$70.90 million	N/A	N/A
Carnival	$26.62 billion	1.43	$2.76 billion	$2.22	12.54

Carnival has higher revenue and earnings than Flight Centre.

Volatility & Risk

Flight Centre has a beta of 0.05, indicating that its share price is 95% less volatile than the S&P 500. Comparatively, Carnival has a beta of 2.32, indicating that its share price is 132% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current recommendations for Flight Centre and Carnival, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Flight Centre	0	1	1	1	3.00
Carnival	0	6	20	1	2.81

Carnival has a consensus price target of $35.08, indicating a potential upside of 25.98%. Given Carnival’s higher possible upside, analysts plainly believe Carnival is more favorable than Flight Centre.

Profitability

This table compares Flight Centre and Carnival’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Flight Centre	N/A	N/A	N/A
Carnival	11.24%	26.11%	6.36%

Summary

Carnival beats Flight Centre on 11 of the 12 factors compared between the two stocks.

About Flight Centre

Flight Centre Travel Group Limited provides travel retailing services for the leisure and corporate sectors in Australia, New Zealand, the Americas, Europe, the Middle East, Africa, Asia, and internationally. The company offers leisure travel services for the niche sectors, as well as mass, youth, premium, and cruise markets; and corporate travel services for organizations of various sizes across industries, as well as supplies products to its national and international network, or travel retail outlets. It also provides tour operations, hotel management, and destination management services. In addition, the company offers other travel related services, including foreign currency exchange and travel academies; recruitment marketing and bike retailing; and employee benefit services. It provides its services primarily under the Flight Centre brand, as well as other travel brands, such as Student Flights, Travel Associates, Liberty Travel, Infinity Holidays, GOGO Vacations, FCm Travel Solutions, Corporate Traveller, Stage and Screen, and cievents. The company was formerly known as Flight Centre Limited and changed its name to Flight Centre Travel Group Limited in November 2013. The company was incorporated in 1987 and is headquartered in South Brisbane, Australia.

About Carnival

Carnival Corp. engages in the operation of cruise ships. It operates through the following business segments: North America and Australia (NAA) Cruise, Europe and Asia (EA) Cruise Operations, Cruise Support, and Tour and Others. The North America and Australia (NAA) Cruise segment includes the Carnival Cruise Line, Holland America Line, Princess Cruises, and Seabourn. The Europe and Asia (EA) Cruise Operations segment consists of AIDA, Costa, Cunard, and P&O Cruises (UK). The Cruise Support segment represents port destinations and private islands for the benefit of its cruise brands. The Tour and Other segment operates hotel and transportation operations of Holland America Princess Alaska Tours. The company was founded in 1972 and is headquartered in Miami, FL.