Shipping

By pjain      Published July 16, 2021, 7 p.m. in blog Education   

Shipping Overall

Key Factors

Ships still transport 90% of the world's trade.

  • Surging consumer demand - Global container SHORTAGE - SHIPS ALREADY JUMPED

    Sharp price increase in freight rates has driven ship stock to all-time highs eg Maersk 78% within the last

  • Congestion - Shanghai, LA - need 30% more trucks to take containers away!
  • covid outbreaks cripples labor available

Expenses, Capex vs Debt

  • Inefficient operating OLD SHIPS - need to be recycled - expensive!
  • heavy dry dock schedules in BULK grain, gas and tanker fleets vs Container QuickTurn
  • Bad weather - lose hundreds of containers

RISKS - climate=> Need to change fuel

Container shipping

Infrastructure, Shipping Fundas

  • Note the TEUs listed here are in millions and includes Existing Fleet + Newbuilds.
  • TEU = twenty-foot equivalent unit of containers

  • Massive Consolidation as top 10 liners control 85% of market, top 4 Maersk, MSC, CMA CGM and COSCO — control more than half of capacity (58%). The top seven, adding Hapag-Lloyd, ONE and Evergreen, control 78%.

  • The top carriers are not done yet - rapidly growing fleets will change ranks.

  • RATIONING and ALLOCATION via vessel-sharing alliances like airline code-sharing for Containers - boosts End-to-End networks. This base level of fleet concentration is then greatly enhanced by the existence of three vessel-sharing alliances on the mainline East-West trades — 2M, the Ocean Alliance and THE Alliance — which count nine of the top 10 liner groups as members.

  • Chinese have the largest orderbook-to-fleet ratio of Wan Hai is 56%, Evergreen 50%, ZIM 37%, CMA CGM and Yang Ming 18%, ONE 17%, and COSCO 9%. These percentages will likely increase further as newbuilds ordered by non-operating owners are identified with their charterers over time.

Keys of Container shipping

r

MSC 4.8 TEU

Maersk 4.2 TEU

  • Valuation c13.7 [7.5ish (6.3 15.3) 15.5ish ]
  • AMKBY:OTCMKTS unsponsored Denmark ADR
  • AMKBF:OTCMKTS
  • 861929 / DK0010244425

  • FY 21 Q1 $12.4b y+30%

  • Jul 15,2021 Shares in A.P. Moeller-Maersk fell more than 6% on Wednesday after the Danish shipping giant warned of a sharp drop in global container volumes as the coronavirus pandemic disrupts global supply chains

  • About Maersk, Denmark

  • 700 ships - 20% of containers
  • owns terminals around the world
  • growing land-based logistics business.

UK - 80 Maersk ships registered in the UK. London has joined Singapore and New York as one of the three centres of ship management and ship excellence outside Copenhagen. Maersk now employs some 26,000 Brits at sea and on shore.

CMA CGM 3.6 TEU

Evergreen Shipping Agency America Corp, Japan 2 TEU fast growing - R8

Hapag-Lloyd 1.9 TEU

--- Chinese Containers - Avoid

COSCO, Chinese - 3.3 TEU

ONE Line 1.8 TEU

HMM 0.8 TEU

YangMing, China 0.7 TEU

Wan Hai, China 0.5 TEU

ZIM 0.5 TEU

OOCL

GOGL 10% Shipping

CSPAN

  • container shipping - own ships => leased to ship cos - contracted cash flows had gotten over levered - valuation come up a bit as they fixed up ..

Bulk Speciality

Keys

Oil and Gas Shipping Speciality

Key Factors

TK

  • FY 21 Q1 May 23'21 conf $ ni $11m 11/sh y 3m/3c-eps

  • CORE: Oil,Gas shipping BULK

  • long-term contracts in our gas shipping business
  • higher spot tanker rates in our oil shipping business
  • higher revenues from our marine services business in Australia.

  • teekay.com IR

  • CEO, Kenneth Hvid; CFO, Vince Lok

TGP - midstream - Div y8%

Gates Masters - sold 1% 25% Q4'20

  • FY 2021 y=7.8%
  • PS 2x vs SP 3.4x
  • PEt 10x fell in half from 2018-19, also median 5yr PEt=15x

  • Value

  • Recent overbought RSI=74 - Zacks strong Sell, WAS BUY DEC'19
  • EPS revisions reduced
  • Technically stock falling

  • About Teekay LNG Partners L.P.


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