Cruise line operator Carnival (NYSE: CCL) came out of the gates hot in 2023, smoking the market with a 45% year-to-date share price gain. It's the type of breakout investors have been waiting for after Wall Street had little worth celebrating in 2022.

But some caution might be prudent here. A few remaining red flags indicate that Carnival stock's recent momentum could be short-lived.

COVID-19 was a disaster for the tourism industry, and it put companies like Carnival in a tough spot. The cruise industry was shuttered overnight, drying up Carnival's revenue and income, and leaving it with huge losses. (Even unoccupied by passengers, ships are expensive to maintain.) Understandably, the stock was hammered. You can see the massive declines in share price and enterprise value below.

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Source Fool.com