Zacks Investment Research downgraded shares of Carnival Plc. (CUK) from NEUTRAL to UNDERPERFORM on February 12, 2013, with a target price of $37.00.
We are downgrading our recommendation on Carnival Plc. from Neutral to Underperform mainly due to tough macroeconomic conditions in the UK, where the company is incorporated. The contraction in the region's GDP in the fourth quarter of 2012 and devaluation of the pound are the most recent headwinds for Carnival. A slowdown in European economy and faltering consumer confidence due to the grounding of Carnival's ship in Italy in Jan 2012 are also acting as major hindrances to the company's growth. In Europe, where the disaster took place, the dip in bookings has been steeper. Though the scenario is improving, we are yet to see the momentum achieved prior to the disaster.
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