Thursday, August 25, 2022
Pangaea Logistics (PANL)
Ship Acquisition Follows Balanced Strategy of Growth and Rewarding Stakeholders
Pangaea Logistics Solutions Ltd. (NASDAQ: PANL) provides logistics services to a broad base of industrial customers who require the transportation of a wide variety of dry bulk cargoes, including grains, pig iron, hot briquetted iron, bauxite, alumina, cement clinker, dolomite, and limestone. The Company addresses the transportation needs of its customers with a comprehensive set of services and activities, including cargo loading, cargo discharge, vessel chartering, and voyage planning. Learn more at www.pangaeals.com.
Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Ship acquisition announced. Pangaea announced the acquisition of a 2010-built vessel for US$17.1 million. Management had indicated it was in final negotiations for a ship purchase during its August 18th call to discuss second quarter financial results so the announcement was not a surprise. Pangaea has operated the ship for over a year on a chartered-in basis and had been approached by the owner. The ship will be delivered in September or October. Owned ships typically command higher margin contracts than chartered-in ships so the acquisition should have a positive impact on financial results going forward.
Acquisition follows management’s balanced strategy of growth and rewarding stakeholders. The Board of Directors has raised the dividend twice in the last twelve months although it opted to hold dividends constant in the most recent quarter. It has also paid down debt and capital leases in recent quarters. The ship acquisition will help grow Pangaea’s asset base. Pangaea’s cash position was $102.2 million (up from $40.6 million at this time last year). We believe the company will pay for the ship, which will be renamed Bulk Sachuest, with cash on hand….
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.