2023-05-23 12:36:37 ET
ZIM Integrated Shipping ( NYSE: ZIM ) -5.1% in Tuesday's trading after plunging more than 16% on Monday after reporting a Q1 GAAP loss that missed analyst estimates and a 63% Y/Y decline in revenues, and saying it would not pay Q1 dividends , citing lower freight rates and weak demand.
ZIM ( ZIM ) reaffirmed its FY 2023 adjusted EBITDA guidance of $1.8B-$2.2B, which would represent a 73% Y/Y decline at the midpoint from the $7.5B it reported in 2022.
Q1 average freight rates sank to $2,780 per forty-foot equivalent unit, down 64% Y/Y and 35% Q/Q.
The company showed a net debt of $381M at the end of Q1, swinging from a net cash position of $279M at the same time a year ago.
Two analysts reduced their price targets on the stock: Barclays maintained its Underweight rating and trimmed its PT to $13 from $15, and Jefferies kept its Hold rating and cut its PT to $16 from $20.
ZIM ( ZIM ) is more exposed to the spot market and has a higher percentage of its capacity in the trans-Pacific than larger ocean carriers such as Maersk and Hapag-Lloyd, which allowed ZIM to outperform rivals during the boom but now it is " paying the price for that strategy , [as] its average rates and earnings are declining faster than those of more contract-focused and geographically diversified carriers," according to Freight Waves analyst Greg Miller.
More on ZIM Integrated Shipping:
- Financial and valuation comparison to sector peers
- Analysis: ZIM Integrated: No Dividend After A Weak Q1 And Deteriorating Outlook
- Stock price return: Down 18% YTD, down 80% in the past 12 months
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ZIM Integrated Shipping sinks for second straight day, weighed by falling spot rates