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Top Shipping Stocks for Q4 2022

The shipping industry includes companies that transport cargo around the world, from grains to apparel to electronics to appliances. In spite of the term “shipping,” these companies often transport commodities and merchandise by air, sea, and on land by truck or train. They also provide storage and other logistics. Some of the largest shipping companies in the world include A.P. Møller-Mærsk A/S (AMKBY) and Hapag-Lloyd AG (HPGLY). The shipping industry has faced ongoing challenges surrounding the COVID-19 pandemic and Russia’s invasion of Ukraine. However, in recent months shipping backlogs have begun to ease.

In the past year, the shipping industry has outperformed the broader market. The benchmark Dow Jones U.S. Marine Transportation Index has provided a 1-year trailing total return of 2.3% compared with -5.6% for the Russell 1000 Index. These market performance numbers and all statistics in the tables below are as of June 9, 2022.

Here are the top 3 shipping stocks with the best value, the fastest growth, and the most momentum, respectively.

These are the shipping stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.

Source: YCharts

  • ZIM Integrated Shipping Services Ltd.: ZIM Integrated Shipping Services is an Israel-based provider of seaborne transportation and logistics services. The company operates a fleet of vessels and offers multi-modal, cargo handling, tariff management, and other related services. On May 18, the company declared a quarterly cash dividend of $2.85 per share. The dividend was paid on June 8 to ordinary shareholders as of May 31, 2022.
  • Danaos Corp.: Danaos is a Greece-based company that owns a fleet of large-size container ships. It charters is ships on long-term contracts at fixed rates to global liner companies.
  • Navios Maritime Partners LP.: Navios Maritime Partners is a Greece-based company offering maritime freight transportation. It owns and operates a fleet of dry bulk and container vessels. On May 10 the company reported financial results for Q1 2022. Net income fell by 37.3% while revenue more than tripled year-over-year (YOY). Net income declined despite a gain from equity in net earnings of Navios’ affiliated companies as well as a “bargain purchase gain” from securing control of Navios Containers.

These are the top shipping stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and their most recent quarterly YOY earnings-per-share (EPS) growth. Both sales and earnings are critical factors in the success of a company. Therefore ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one or the other figure unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of over 2,500% were excluded as outliers.

Source: YCharts *Global Ship Lease’s revenue number in the table above is time charter revenue growth.

  • Genco Shipping & Trading Ltd.: Genco Shipping & Trading is a company that provides global commodities transportation services. It owns ships and offers full-service transportation and logistics for iron ore, grain, steel, cement, nickel ore, and other commodities. Net income attributable to Genco Shipping & Trading surged by about 21-fold on robust revenue growth YOY for Q1 2022, as reported by Genco on May 4. Growth was driven by higher rates achieved by major and minor bulk vessels and by third-party time chartered-in vessels.
  • Global Ship Lease Inc.: Global Ship Lease is a U.K.-based owner of containerships. The company charters out mid-sized and smaller containerships to container liner companies. It reported Q1 2022 earnings on May 9. Net income grew nearly 17-fold as time charter revenues nearly doubled YOY. The company said that highly attractive charters which it added over the past year helped to drive growth.
  • Grindrod Shipping Holdings Ltd.: Grindrod Shipping Holdings is a Singapore-based company that charters, operates, and sells shipping vessels. It provides shipping and management services to the drybulk industry.

These are the shipping stocks that had the highest total return over the last 12 months.

Source: YCharts

  • Grindrod Shipping Holdings Ltd.: See above for company description.
  • Westshore Terminals Investment Corp.: Westshore Terminals Investment is a Canada-based company that, through Westshore Terminals Limited Partnership, operates a coal storage and loading terminal in British Columbia. The company issued its earnings report for Q1 2022 on May 4. Profit declined by 12.9% on falling revenues YOY. Coal loading revenue, volumes, and tonnage shipped all fell over this period.
  • ZIM Integrated Shipping Services Ltd.: See above for company description.

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