Friday, March 18, 2022
Pangaea Logistics (PANL)
Post Call Update – Weakness Not Warranted
Pangaea Logistics Solutions Ltd and its subsidiaries provide seaborne drybulk transportation services. It transports drybulk cargos including grains, coal, iron, ore, pig, iron, hot briquetted iron, bauxite, alumina, cement clinker, dolomite and limestone. The firm’s services include cargo loading, cargo discharge, vessel chartering, voyage planning and technical vessel management. The company derives all of its revenues from contracts of affreightment, voyage charters and time charters. Its strategy depends on focusing on increasing strategic contracts of affreightment, expanding capacity and flexibility by increasing its owned fleet and increasing backhaul focus and fleet efficiency.
Poe Fratt, Senior Research Analyst, Logistics, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Call highlights. Favorable dry bulk market fundamentals, especially the low order book, intact despite the ongoing market reset due to Russian sanctions. No concerns about counter party risk even though expanding receivables triggered $1.5 million increase in doubtful accounts. Bunker fuel prices have moved up, but typically hedging 75% of fuel consumption helps temper impact.
No change in 2022 EBITDA estimate of $98.0 million based on TCE rates of $24.8k/day. Well positioned after positive developments last year. Strong 2021 results make comps tough, but this year should be solid and TCE rate on 1Q2022 forward cover approximates $26.5k/day. Positive outlook based on a consistent commercial strategy that adds value in different market environments, a leading Ice Class …
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.
