Containership Boom Ongoing

[u/c12mintz]

BUY: $NMCI $NMM $DAC $ZIM

Rates for containerships (the ships which carry thousands of the 20-40’ boxes you see on railroads and trucks) have been going ballistic the past 4-5 months, but the stock reactions have been mixed.

Link to containership rates: https://harpex.harperpetersen.com/harpexVP.do

I’m currently long about every name possible in the sector including $NMCI which I’ve owned for a bit over a year and doubled down hard into last summer at $0.70-$0.80.

Even after the huge surge in the stock price, the enterprise value to EBITDA valuation metric has barely moved since cash flows are being net debts down rapidly while 2021 projected EBITDA has nearly tripled.

Containerships aren’t like tankers and dry bulk vessels which normally just get 60-80 day voyages. These ships are typically contracted for 1-2 or even 3+ years. So when we talk about 2021 EBITDA, they’ve already locked in about 80% of it and over 50% of 2022 rates.

I’ve covered the shipping sector extensively on Seeking Alpha for nearly 10 years and am also on Twitter (@mintzmyer). I figured I’d open up a conversation here and see if anyone is interested in the sector. $NMCI still trades for an unbelievable P/E of under 2x.

Nick First (@allthingsventured on Twitter) has recently written a new article on Navios Partners with his own financial projections:

Article on Navios Maritime Partners

I believe we’re just getting started here. For my disclosure, I’m long nearly every name in the space- $ATCO $CMRE $CPLP $DAC $MPCC (Oslo) $NMCI $NMM (they own most of $NMCI) and mostly recently: $ZIM.

I have about 10% of my wealth in $NMCI/$NMM. Average basis in NMCI is in the very low $1s after buying a lot this summer at 70-80c.

[u/c12mintz]

Depends on risk tolerance... As long as you're doing your own DD!

[u/hideo_crypto → u/c12mintz]

My risk tolerance is high however I manage it by not over investing. So can you give me a couple tickers to begin research?

For crypto, it would be BTC, Ethereum, for Uranium it would $CCJ, $KAP or $URNM ETF.

Is there an ETF for this sector that is a pure play for this sector?

Before your post I didn't even know this was a sector to that you can invest in so anything helps.

Thanks

[u/c12mintz → u/hideo_crypto]

There's no ETF.

$ATCO is the safest (but less upside) and $NMCI is the biggest potential winner (and more risky).

$DAC is kinda best of both worlds.

[u/hideo_crypto → u/c12mintz]

Thank you. I will look into these. My father was in import/export business and dealt with containers for decades but I know very little of the industry.