Monday, November 09, 2020
Eagle Bulk Shipping (EGLE)
Turning Point? 4Q2020 Off to Solid Start
Eagle Bulk Shipping Inc. is a US-based drybulk owner-operator focused on the Supramax/Ultramax mid-size asset class, which ranges from 50,000 and 65,000 deadweight tons in size; these vessels are equipped with onboard cranes allowing for the self-loading and unloading of cargoes, a feature which distinguishes them from the larger classes of drybulk vessels and provides for greatly enhanced flexibility and versatility- both with respect to cargo diversity and port accessibility. The Company transports a broad range of major and minor bulk cargoes around the world, including coal, grain, ore, pet coke, cement, and fertilizer. Eagle operates out of three offices, Stamford (headquarters), Singapore, and Hamburg, and performs all aspects of vessel management in-house including: commercial, operational, technical, and strategic.
Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Adjusted 3Q2020 EBITDA slightly below expectations due to lower-than-expected TCE rates and negative variances in opex and S,G&A expenses. The dry bulk market recovery that began in June, boosted operating results, but reported 3Q2020 EBITDA of $11.5 million was about $1.0 million below our estimate after excluding derivative losses of $2.9 million. TCE revenue was lower and opex and S,G&A expenses were higher than expected. Excluding the derivative losses, adjusted EBITDA was $14.5 million.
Adjusting 2020 EBITDA estimate to reflect 3Q2020 operating results and forward cover that reflects the firmer 2H2020 dry bulk market. The dry bulk market improved over the past five months with 4Q2020 forward cover of 73% of available days booked at $11,275/day compares favorably to 3Q2020 forward cover of 66% of available days booked at $9,220/day. Operating costs were higher in 3Q2020 and we are …
This 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.