Outlook for container cos to improve as freight rates soar - Jefferies

Star Bulk Carriers

31/01/2024 11:26

** Though Jefferies expects weak Q4 earnings from shipping
companies, it sees a more positive outlook given the strength in
freight rates since mid-December amid geopolitical tensions 
    ** The sudden tightening of the market leaves scope for
conservative guidance, followed by upwards revisions down the
line, Jefferies says
    ** Shipping disruptions amid Houthi attacks on cargoes in
the Red Sea are likely to be a key topic as increasing
diversions have a significant impact on container capacity,
Jefferies says
    ** Jefferies anticipates record fourth-quarter results for 
liquefied petroleum gas (LPG) operators, sequentially stronger
results for tankers and dry bulk, and stable earnings for
liquefied natural gas (LNG)
    ** It names MAERSK  MAERSKb.CO  and ZIM  2SV.F  as its top
plays in the container sector
    ** It cuts Euronav  EUAV.BR  to "hold" from "buy", expecting
 significant capex and a higher debt load in the coming years
for the Belgian oil tanker and storage operator following the
acquisition of identified non-tanker assets
    ** It also cuts Eagle Bulk Shipping  EGLE.N  to "hold" from
"buy" as the shares appear to fully-price in the all stock
merger offer from Star Bulk  4FAP.F    

 (Reporting by Diana Mandiá)
 ((diana.mandiaalvarez@thomsonreuters.com))