What Is the Brand Re-Build Strategy for Carnival?

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Sept. 23 (Bloomberg) –- Telsey Advisory Group Analyst Joshua Herrity discusses his price target for Carnival ahead of earnings tomorrow. He speaks with Julie Hyman on Bloomberg Television’s “Street Smart.” (Source: Bloomberg)

Herrity.

We have talked a lot about carnival being plagued by mishaps.

Are we going to see any kind of progress by the company this quarter?

I think investors are taking a longer view of the carnival story.

I don't think this is so much a court early story as it is a brand rebuilding story.

We know that pricing was challenging during the quarter.

And we know that in the quarter from the aftermath of the triumph issue as well.

They have a rebuild strategy and what is the timeline for that strategy is the question as well as how much it will cost.

Are you looking at the first quarter -- the ceo who took over in july, this will be the first quarter he will be participating in the earnings report.

Do you expect to get details of their plans?

We could.

The new ceo, i expect him to be working with the are operational brand heads -- with the operational heads and the brand managers to get to know the operation of the editor.

I see him taking part in the budgeting and planning process, which for them is in the october and november timeframe.

And then we will hear from him on the december call about strategies going forward.

We could be a little light on details tomorrow.

What do you want to hear, though?

Not just tomorrow, but in the future?

What does carnival need to do?

I think their strategies they have laid out are important.

The first was to put out capital to improve the existing fleet and increased backup capabilities.

They are also reaching back out to the travel agent community to improve their relationship.

And they are stepping up marketing.

We can expect to see a primetime marketing campaign beginning tonight.

This is not an easy booking.

-- easy booking timeframe.

The fact of the matter is, there are 10 million carnival guest each year and some of these issues have only affected a small proportion of those guest.

And most come off of the ships having had a great time.

You do not have a rating, but you do have a $42 price target in the next 12 months.

"taking stock" is next.

This text has been automatically generated. It may not be 100% accurate.

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