3Q2021 TCE Rates Above Expectations and 4Q2021 Off to Good Start. 3Q2021 EBITDA of $33.6 million was well above expectations by $8.4 million. Higher TCE revenue, higher TCE rates of $28.8k/day, higher shipping days, lower voyage expenses and lower opex, which more than offset higher charter hire expenses.Increasing 2021 EBITDA estimate to $95.6 million based on TCE rates of $24.3k/day from $76.0 million based on TCE rates of $22.2k/day. We believe that the prospects look good based on solid 4Q2021 forward cover, with 2,053 shipping days (~44%) booked at TCE rates of $33.0k/day. In addition, the last two Post Panamax new builds were delivered. While Supramax and Panamax rates were ~$32.0k/day in 3Q2021 and current rates have moved closer to $25k-$30k/day, the finish to the year appears strong.Moving 2022 EBITDA estimate to $66.8 million based on TCE rates of $22.2k/day. Strong 2021 makes comps tough, but next year should still be a good one. Looking at the prospects for the dry bulk market into next year, we are encouraged that the order book remains muted. In addition, the fleet renewal program expanded the fleet to 25, which should have a positive impact. The comparisons will be challenging in 2022 and results are not likely to match 2021 operating results, but it should still be a solid year.1Q2022 acquisition planned. After selling older dry bulk vessels over the past two years, 2021 will end up very busy on the fleet renewal front, with the delivery of four Ice-Class Post Panamax new builds and closing of three acquisitions. In early November, an acquisition of a 2009-built Panamax was lined up for $19.9 million, with delivery slated in 1Q2022.Maintain OUTPERFORM Rating and price target of $6.50/share - Upside potential remains attractive. While the dry bulk market materially firmed over the first three quarters, it has softened recently due to concerns about economic growth, mainly in China. We believe that supply/demand are close to balanced and expect a recovery next year. Plus, we like the consistency of the unique business model, and the public market float expanded following the likely exit of the former major shareholder. Since hitting a 2021 high of $6.20/share in early September, the stock has dropped ~27%, and we believe that PANL is undervalued trading at an enterprise value multiple of 4.9x 2021E EBITDA. Read More >>