Cruise Stocks Sink After Carnival Announces $1 Billion Share Sale

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Shares of major cruise lines widely tanked on Thursday after Carnival announced a $1 billion stock sale.

a $1 billion stock sale—its second capital raise in recent months—in order to to pay down debt, as the cruise industry continues to feel the impact of the Covid-19 pandemic, surging inflation and higher fuel prices.Lynne Sladky/Associated PressShares of major cruise operator Carnival fell nearly 12% on Thursday after the company said it would sell $1 billion worth of stock—just over 102 million shares—at $9.95 per share, with the option to buy an additional 15.3 million shares.

Carnival ended the second quarter with roughly $35 billion in debt—more than its peers—and $7.5 billion in cash, but analysts last month warned that could “” if customer demand takes a hit in the form of fewer bookings and more canceled deposits.

 

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