GE shipping ,Monthly :- It broke it’s lifetime high of 625 today that they made during 2008,I am not much of technical guy but fundamental wise the stock is bound to break it’s lifetime high due tanker rates being super high due to russia-ukraine war.This quarter they posted the highest net-profit ever in the history of the company and management in this con-call has guided for a even higher net profit due to tanker rates moving much higher due to exports of gas and oil because of winter.Even if russia and ukraine war was to stop tomorrow ,it will take time to heal wounds and for europe to start buying gas and oil from russia again so these tanker rates might not fall in the near future.This is the only listed shipping company apart from shipping corporation of India which is a Psu,shipping buisness all about cyclicality might not be worth investing in Sci as it works for the nation then the shareholders.
Historically the company has traded between 50 to 110% of it’s book value currently at 65% and with all the tailwinds(high dollar rate, high scraping price for ships, company becoming net debt free, new shipping scrapage policy reducing supply of ships in the shipping sector this might do very well.
If we look at a global scale many shipping stock have given a return of 2X to 4X in the last year alone and they have been.
Counter arguments :- a global recession could trigger a low demand for commodities leading to what happened in shipping stocks 15 years back during the 2008 financial crisis. but the company is ready with cash this time in balance sheet to add to it’s ageing fleet this time.
Disc :invested from 280 levels will add more if the tankers rates keep going higher and price stays rangebound.
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