Miami, FL-based cruise operator, Carnival Corporation CCL recently hiked its quarterly dividend by 17% to 35 cents per share. Previously, the company had been paying a quarterly dividend of 30 cents.The new payout amounts to an annual dividend of $1.40 per share and represents a yield of 2.7%. This is the third dividend hike since 2010. Prior to this, Carnival had increased its dividend by 20% in Jul 2015.The increased dividend will be paid on Jun 17, 2016 to shareholders on record as of May 27.Strong balance sheet and cash flows provide Carnival the financial flexibility to offer dividend hikes. The company’s cash and cash equivalents were $778 million. Carnival spent approximately $330 million on capex, and its cash from operations amounted to $798 million.Strong marketing initiatives have been helping the company to keep its bookings strong over the past few years at most of its itineraries, thereby resulting in improvement in revenue yields. Its consistent efforts to reduce fuel consumption have aided the company to generate profits.The strength of Carnival’s business model is reflected in its strong cash generation capabilities and commitment to return value to shareholders. We believe that consistent dividend hike will inspire investors’ loyalty toward the stock.Carnival is one of the largest cruise companies and operates on a global scale. Its market leading position offers a cost advantage allowing it to generate higher return on investment than smaller companies. Further, its leadership position provides it with the scope to expand capacity — by upgrading current ships and increasing the fleet — given higher cash from operations and comparatively lower debt burden.Currently, Carnival has a Zacks Rank #3 (Hold). Some better-ranked stocks in the same space include Carmike Cinemas Inc. CKEC, Planet Fitness, Inc. PLNT and Vail Resorts Inc. MTN, all holding a Zacks Rank #2 (Buy).Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CARNIVAL CORP (CCL): Free Stock Analysis Report CARMIKE CINEMA (CKEC): Free Stock Analysis Report VAIL RESORTS (MTN): Free Stock Analysis Report PLANET FITNESS (PLNT): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research