2024-06-11 14:22:44 ET
Summary
- Rates have increased by 35% since last month's article and I see ZIM as the main beneficiary with high spot exposure.
- Q2 guidance is expected to be revised higher, with Q3 projected to be the strongest quarter of the year.
- Analysts' earnings estimations are too low and should be revised higher, improving valuations.
I have covered ZIM Integrated Shipping Services Ltd. ( ZIM ) previously. Investors should view this as an update to the previous articles on the company , where I provided an extensive business overview and explained the investment thesis in detail. The main point of the thesis has played out, and ZIM will finish the year without burning cash. On February 9th, I presented the thesis, explaining that the Red Sea disruption was here to stay and that ZIM could generate substantial profits. Since then, the stock has appreciated around 100%, and in my most recent article on May 22nd, I downgraded it to a hold, as I still believed it had potential but the risk/reward was less appealing....
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ZIM Integrated: Rates Are Heading Higher, ZIM Will Follow (Rating Upgrade)