ZIM Integrated Shipping rises as JPM upgrades on potential lower costs

Zim Integrated Shipping Services

18/09/2023 13:55

** U.S.-listed shares of Israel-based shipping co ZIM
Integrated Shipping Services  ZIM.N  rise 3.6% to $11.39
premarket 
    ** J.P.Morgan upgrades co to "overweight" from "neutral";
only brokerage with a "buy" rating on co's stock, per LSEG data
    ** "Over the past 2 years ZIM has moved from a leader in
profitability to having possibly the lowest margins in the
sector. We view this as temporary," JPM analysts say in a note,
pointing to potential for costs to decrease
        ** JPM sees ZIM's losses narrowing as expensive
Covid-era ship rental contracts are redelivered or renegotiated 
    ** JPM says co's higher exposure to spot rates, that are
decided on the spot, vs. peers in the Trans-Pacific will also
make it an outperformer in the current quarter as the route
accounts for 30% of co's trade volume 
    ** Of the 7 analysts covering co's stock, 1 has "buy"
recommendation, 3 "hold" and 3 "sell" or lower; median PT stands
at $13
    ** ZIM on Friday hit its lowest level since its market debut
in January 2021, taking its year-to-date losses to 36%

 (Reporting by Purvi Agarwal in Bengaluru)
 ((Purvi.Agarwal@thomsonreuters.com))