XTN - Euroseas: Coasting Well But Not A Buy At These Levels

2024-05-27 19:36:07 ET

Summary

• Euroseas Ltd. has outperformed the total stock market by 3.8x in the past year.
• The rerouting effects from the Red Sea are serving as a useful panacea for the industry which otherwise would have been facing pressures on account of an increase in capacity.
• Capacity pressures will be less pronounced for ESEA, which operates in the feeder and intermediate segment of the market.
• ESEA is currently priced at an EV/EBITDA premium of 56% relative to its historic average, and is poised to witness a 13% contraction in EBITDA through FY25.

ESEA Is In A Good Way

Over the past year, the broader equity markets have been resilient enough, delivering returns of 28%. But how about the performance of Euroseas Ltd. ( ESEA ), a Greek shipping entity that operates in the containership space? During the same period, ESEA has ended up trouncing the total stock market by around 3.8x....

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