2024-04-17 23:32:22 ET
Summary
- Global Ship Lease's balance sheet is strong, the leverage is steadily decreasing, and the contract revenues are sufficient for solid FCF generation in the coming quarters.
- However, I'm concerned that the current undervaluation may be justified, as new ships will soon be coming onto the market.
- The current dividend yield of 7% looks good but does not provide a sufficient margin of safety in my opinion.
- I decided to downgrade GSL to "Hold" and recommend that investors write call options or trim their existing long position.
My Thesis
Since August 2021, I have published 4 bullish articles on Global Ship Lease, Inc. ( GSL ), pointing out that the market was underestimating the company's growth prospects, which has led to a sharp valuation discount....
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For further details see:
Global Ship Lease Stock Looks Good, But I Have Some Concerns (Rating Downgrade)