Analyst Qianlei Fan of Morgan Stanley maintained a Sell rating on COSCO SHIPPING Holdings Co (CICOF – Research Report), retaining the price target of HK$6.50.
Qianlei Fan’s rating is based on a careful analysis of shipping rates and their impact on COSCO SHIPPING Holdings Co’s financial health. The Shanghai Containerized Freight Index (SCFI), a leading indicator for actual shipping rates, shows a mixed pattern of rate changes across various routes. Although there’s a slight increase in the index, the fluctuations suggest instability in the market, which in turn could indicate a challenge for COSCO SHIPPING Holdings Co in maintaining consistent revenue and profit streams. This volatility in shipping rates is a key concern influencing the Sell rating.
Furthermore, considering that the SCFI is correlated with the stock performance of COSCO SHIPPING Holdings Co, Fan anticipates that any inflection in the index is likely to signal a potential shift in the company’s share price. With this perspective, the current and projected market conditions, as reflected by the SCFI, seem to suggest a cautious outlook for the company’s stock. The analysis, therefore, concludes with a Sell rating due to the anticipated influence of unstable shipping rates on the company’s financial performance and its stock’s future trajectory.
Fan covers the Industrials sector, focusing on stocks such as COSCO SHIPPING Holdings Co, ZTO Express, and BOC Aviation. According to TipRanks, Fan has an average return of -1.4% and a 41.67% success rate on recommended stocks.
In another report released on April 3, Goldman Sachs also maintained a Sell rating on the stock with a HK$6.80 price target.
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COSCO SHIPPING Holdings Co (CICOF) Company Description:
COSCO SHIPPING Holdings Co. Ltd. engages in the provision of container shipping, managing and operating container terminals and container leasing services. It operates through following business segments: Container Shipping, Container Terminal, and Corporate and Other Operations. The company was founded on March 3, 2005 and is headquartered in Tianjin, China.
