Wednesday, May 17, 2023
Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA. Euroseas operates in the container shipping market. Euroseas’ operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.
Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
First-quarter results largely as expected. Financial results continue to suffer the effects of a sharp decline in TCE rates over the last twelve months. While Euroseas has locked in 91% of remaining shipping days in 2023, those rates eventually roll off and get replaced with lower rates. The Aegean Express ended a contract at $41,000/day, which was replaced by a rate of $13,000/day. Four other ships with rates in the high $20,000’s/day will roll off in the second half of the year.
Shipping rates are improving and could go higher. Shipping rates appear to have bottomed out in February. Current rates for 1,700 TEU and 2,500 TEU ships have risen to $16,800/day and $18,750/day, respectively, returning to a point above the ten-year trailing average and Euroseas’ breakeven cash operating point. We believe rates will move even higher should global economic concerns abate and the war in Ukraine comes to an end.
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