CICOF - COSCO Shipping: Beware A Return To Normalcy
2024-07-21 09:00:38 ET
Summary
- COSCO Shipping has rallied strongly this year.
- But the safety margin is also a lot narrower.
- In the face of a cyclical swing, it may be time to pull back here.
The container shipping industry goes through some vicious cycles (in both directions), and this time is no different. Coming off COVID-driven supply chain disruptions, supply tightened yet again this year, this time on longer than expected disruptions in the Red Sea – an all-important channel from an economic and convenience perspective for the Europe-Asia shipping route. State-owned Chinese container shipping company COSCO Shipping ( OTCPK:CICOF ) has naturally seen its stock benefit, not only from a tightening supply/demand balance (see COSCO Shipping: Still An Overly Discounted Shipping Play ) but also from a very cheap valuation, which at one point last year, even dipped below net cash (see COSCO SHIPPING: Unfairly Penalized And Priced Below Net Cash )....
COSCO Shipping: Beware A Return To Normalcy