Carnival stock sinks on $1 billion convertible debt offering

Yahoo Finance Live anchors discuss the decline in stock for Carnival amid the cruise line’s $1 billion convertible debt offering.

Video Transcript

[AUDIO LOGO]

BRAD SMITH: Checking in on Carnival Cruise lines.

BRIAN SOZZI: Don't do it.

BRAD SMITH: Ticker symbol CCL. We're tracking those shares this morning, down by about 12% here as the cruise line commenced a private offering of $1 billion of convertible senior notes due in 2027. It's gonna be used as part of Carnival's 2024 refinancing plan here.

So you're seeing shares move lower, likely due to, of course, this being kind of one of those dilutive measures there. However, it is at a time where the cruise line operators, we know that they're trying to re-engage customers, who perhaps have pushed out some of their trips. I don't know, Sozz. Maybe--

BRIAN SOZZI: This is-- you know what? I'm gonna book a Carnival Cruise line right now as my left coast or elitist self. I can afford about 10 Carnival trips here. But I will note this on a serious note, here's a company with $28 billion in debt, adding more debt at a time where prices are under pressure and people aren't taking cruise lines. All that is red flag. And that's why you're seeing Carnival shares get really sunk here in the premarket-- or not, in the open market. It's 9:36.