| Videos | Channels | Search |
Trade idea: Long Maersk as profits rise
Danish oil and shipping group A.P. Moller-Maersk reported a USD 554 million profit, up from USD 498 million a year earlier.
Maersk Line, whose vessels make up around 15 percent of the world's container shipping capacity, said the results were due to "operational cost savings - mainly from vessel network efficiencies and improved vessel utilisation."
From an investment perspective, Saxo Bank’s Peter Garnry says: "Our valuation models suggest the stock is undervalued, so we would long Maersk at this point."
But he adds: "We need the line operations to be stronger but that could probably come through next year as the global economy improves."
Though Maersk Line increased its transported volumes by 11 percent compared to the same quarter last year, revenue fell 2.6 percent to USD 6.78 billion, as freight rates were 12 percent lower than in the same quarter last year.
Still, Peter thinks that Maersk has what it takes as a long term investment: "They have the oil business, the drilling, and the terminals which generates very stable cash flows." Adding that "Maersk has had losses in the business as well, but they have the cash flows from the other segments which can support the shipping business going through these rough times."
Danish oil and shipping group A.P. Møller-Maersk reported a USD 554 million profit, up from USD 498 million a year earlier.
Maersk Line, whose vessels make up around 15 percent of the world's container shipping capacity, said the results were due to "operational cost savings - mainly from vessel network efficiencies and improved vessel utilisation."
From an investment perspective, Saxo Bank’s Peter Garnry says: "Our valuation models suggest the stock is undervalued, so we would long Maersk at this point."
But he adds: "We need the line operations to be stronger but that could probably come through next year, as the global economy improves."
Though Maersk Line increased its transported volumes by 11 percent compared to the same quarter last year, revenue fell 2.6 percent to USD 6.78 billion, as freight rates were 12 percent lower than in the same quarter last year.
Still, Peter thinks that Maersk has what it takes as a long term investment: "They have the oil business, the drilling, and the terminals which generates very stable cash flows." Adding that "Maersk has had losses in the business as well, but they have the cash flows from the other segments which can support the shipping business going through these rough times."
Disclaimer
Saxo Bank Group provides an execution-only service. All information provided on Tradingfloor.com is solely for general information. Tradingfloor.com does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. Saxo Bank Group will not be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available as part of the Tradingfloor.com or as a result of the use of the Tradingfloor.com.
Please read our notification on
Non-independent investment research disclaimer
01:42 minutes
Tags: container, danish maersk, denmark, equities, equity market, investing, investment, lea jakobiak, maersk, maersk container, maersk investment, maersk line, maersk profit, maersk share price, maersk shares, maersk shipping, moller maersk, peter garnry, profit taking, saxo bank, saxo tv, share price, shares, shipping, shipping industry, stock, stock market, stocks, tradingfloor.com, video