In Q3 last year, Carnival's profit was $1.38 per share.
'We anticipate the potential for slightly positive constant-currency net yields in Carnival's fiscal third quarter, which would mark the first inflection into positive yield territory since February 2012,' Zackfia said in a note.
The brokerage projects a constant-currency net yield change of zero to 0.5%, slightly better than guidance for flat to down 1% and improved from the second quarter's 2.2% decline, reflecting continued positive yields at Carnival's European brands offset by negative yields in North America.
William Blair said early indications show the decision to sacrifice some occupancy to stabilize Carnival Cruise Lines' Caribbean pricing is paying off, with improved pricing trends across most itineraries—although more recent pricing has moderated some for the winter Caribbean season. As a result, Zackfia said, consolidated pricing trends have been more consistently in positive territory since April, despite moderating more recently for the winter Caribbean season.
Zackfia sees encouraging signs for pricing trends in summer 2015, likely due to the double-digit decline in Caribbean capacity in next year's August quarter.
Fuel price and currency exchange rate movements may be a small incremental profit drag in the third and fourth quarters, about a penny each, the analyst said, as slightly more favorable fuel pricing is more than offset by the stronger dollar.
Zackfia expects Carnival's Q4 EPS guidance to encompass her estimate of 20 cents and the 21-cent consensus. She expects overall net yields to increase 1% to 1.5% on a constant-currency basis, including positive North American yields as industry-wide Caribbean capacity goes up 13%, compared to the 22% Q3 increase and, for Carnival, a 5% to 6% increase, down from Q3's 19%.
For the full year, William Blair expects Carnival to narrow its EPS guidance toward the higher end of its previous $1.60 to $1.75 range, versus the brokerage's estimate of $1.74.
The brokerage raised its 2015 constant-currency net yield projection to 3% from 2%, given early pricing indications for next summer. That takes its EPS estimate up 16 cents, to $2.29, although still slightly below the $2.33 consensus.
Carnival's 2013 profit was $1.58 per share.
At 17 times William Blair's 2015 EPS estimate, Carnival stock continues to trade somewhat above its typical mid-teens P/E valuation.
'As a result, while we are encouraged by some early signs of traction for next summer, we believe a healthy recovery is already largely incorporated into the valuation and prefer to wait until greater clarity is achieved as to the magnitude of a potential pricing recovery next year, particularly given the potential for continued cross-current during the winter season,' Zackfia said.
The brokerage held its 'market perform' rating for CCL.