CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved.

FTSE 100 fallers: why is the Pearson and Carnival share price tumbling?

The British publishing company’s shares have slumped due to declining print sales, while the Anglo-American cruise operator’s stock sunk after slashing its 2019 profit guidance for the third time this year.

FTSE 100 Source: Bloomberg

Pearson’s share price continues to struggle after issuing a profit warning last week due to weaker-than-expected print sales in its third quarter, while fellow blue-chip Carnival Corporation & PLC (US) has also seen its stock slide after slashing its earnings forecast.

Pearson profits hit by students ditching print products

Last week, the British educational publishing company warned investors that its full-year profits will likely come in at the bottom of its guidance range, prompting its share price to fall 14%, with the company's stock down 20% since January. Pearson's stock has underperformed compared with the rest of the market, with the FTSE 100 up 10% on a year-to-date basis.

The profit warning came after the company reported weak sales in its US higher education courseware unit, with adjusted operating profit expected to hit £590 million, rather than the £640 million it originally targeted.

The publishing company blamed the sales slump on students ditching print products in favour of digital educational resources online.

‘The third quarter has been significantly weaker than we expected in US Higher Education Courseware,’ said chief executive John Fallon.

‘Whilst difficult in the short term this places more importance on our work to remake this part of Pearson and we are exploring new ways of deploying our new technology platform so that we can offer students highly affordable, convenient, adaptive, digital courseware,’ he added.

Despite the slump in sales, Pearson expects overall revenues to stabilise this year, driven by strong growth in other parts of the business.

Pearson’s stock closed 3% lower at £7.23 on Wednesday.

Carnival shares sink despite record third-quarter earnings

The cruise operator published a record set of third quarter earnings last week, but it wasn’t enough to stop the company having to slash its full-year profit guidance for the third time this year.

The company expects adjusted earnings of between $4.23 to $4.27, down from the $4.25 to $4.35 guidance range it offered earlier in the year.

Carnival blamed the profit downgrade on higher fuel prices and weaker consumer confidence caused by political and economic instability.

The tour operator’s stock has fallen more than 13% since it cut its guidance, with it closing 3% lower at £31.86 on Wednesday.

‘As a truly global cruise company, with nearly 50% of our guests sourced outside of the US, we are facing a number of current headwinds, including weakening economies affecting our Europe & Asia segment, a strong dollar and of course, the IMO 2020 regulations, and we are working to mitigate them,’ Carnival CEO Arnold Donald said.

Start trading Pearson and Shell shares with an IG demo or live account

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.

Act on share opportunities today

Go long or short on thousands of international stocks with CFDs.

  • Get full exposure for a comparatively small deposit
  • Trade on spreads from just 0.1%
  • Get greater order book visibility with direct market access

See opportunity on a stock?

Try a risk-free trade in your demo account, and see whether you’re on to something.

  • Log in to your demo
  • Take your position
  • See whether your hunch pays off

See opportunity on a stock?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Trade a huge range of popular stocks
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See opportunity on a stock?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.