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Improved Analytics And Better Results For Shipping Investors


  • The shipping sector can often be a confusing arena, accelerated by the lack of good data and analysis available to retail investors.
  • Earnings ratios, book values, and many other 'traditional' financial metrics are often very misleading and sometimes downright incorrect.
  • We have partnered with VesselsValue over the past few years to bring accurate live ship valuations to investors on Seeking Alpha and at Value Investor's Edge.
  • VesselsValue has continued to improve its platform and is now offering unique trade data insights and fleet information.
  • We're expanding our partnership to cover these new features and will be bringing some of this analytics to our future research. I encourage all interested investors to check out these latest improvements.

Note: We covered why current ship valuation data is important for investors in a public report from early-2017. This is highly recommended reading for anyone with investments in this sector. The most relevant related fund is Guggenheim Shipping ETF (NYSEARCA:SEA-OLD), but there are over 60 publicly-listed companies, some of which are discussed below.

Benefits of Good Data

Successful investment in the shipping sector requires rigorous analysis, good understanding of macro trade flows, and quite honestly a fair degree of luck. We've been working in the sector for nearly a decade and have experienced significant ups and downs across a variety of areas including dry bulk, containerships, crude tankers, product tankers, and gas vessels.

Since mid-2013, we have partnered with VesselsValue "VV" to be our primary data provider, and we have continued and improved our collaborations as we move forward. VV is a very important service for anyone with significant capital invested in the shipping sector because it provides current valuations of assets and real-time data analytics to help improve awareness and confidence with investment allocations.

Bullish Example - Find Gems

When we're working on our industry overviews, we often use VV data to study upcoming vessel supply trends and to cross-check current valuation data with share prices. Last December, International Seaways (INSW) came public as a spin-off and immediately began trading into the ground. We used VV data to help determine a NAV valuation in the mid-$20s, and at Value Investor's Edge, we piled into the stock between $11 and $14. We brought our idea public a bit later and eventually sold at $22.50, for a gain of 67% in 6-7 months.

We've recently re-opened our bullish position in these difficult markets, picking up shares in the high-$15s. Our current NAV analysis points to a valuation around $26/sh, although we've set our price target

Access The Latest Research

If you found this report helpful, I invite you to follow us for the latest access to our research. We offer a highly-ranked research service, Value Investor's Edge, which includes deep value coverage on 60+ firms, which includes dozens of stable high-yield income opportunities.

We're offering a limited-time free trial so readers can review our historical content and make up their minds risk free. Please consider joining a rapidly growing community of deep value investors at Value Investor's Edge. Undecided? Please feel free to examine our reviews. Send a private message at any time for more information. I look forward to working together soon!

This article was written by

J Mintzmyer profile picture

J Mintzmyer specializes in deep value stocks and macro analyst in the maritime shipping and energy sectors. He has earned a PhD from the Harvard Kennedy School, where he researched sanctions and trade flows. Previously, J earned an MPP from the University of Maryland, worked as a research intern with the White House Council of Economic Advisors, and earned a Bachelors in Economics from the U.S. Air Force Academy.

J is the Founder and Head of Research of the investing group Value Investor's Edge, a deep value research community focused on maritime shipping, offshore energy, and energy infrastructure. He leads a team of 11 analysts and data experts who focus exclusively on maritime shipping and related energy infrastructure. The team has delivered consistent outperformance since launch in 2015 and the long-only model portfolios have produced an average annualized return of 43% over the past 8 years. VIE offers exclusive analytics, research reports, earnings coverage, and a live chat with an engaged community of more than 750 members. Learn more here.

Analyst’s Disclosure: I am/we are long LPG, INSW. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (22)

I've been swinging in and out of DSX. It is looking attractive @ 4 bucks a share.
C.Phillips profile picture
The shipping industry’s profits will see a large decline when IMO is enacted. Just look at all the refinery’s profit predictions. This industry will see a slight bump when trade is settled but don’t think it will return to last years levels within the next 2-3 years if at all.
J Mintzmyer profile picture
Depends what happens with supply of older vessels. New regulations often lead to an increase in profits for newer vessels.
J, great job partnering with VV. For my shipping investments I rely heavily on your research and over the past year and a half have found your research to be the best on SA (shipping and otherwise). Always look forward to reading your articles.
J Mintzmyer profile picture
Thanks jr. It has definitely been a great data source for us, and I'm continually impressed by their data developments. Been working with VV since mid-2013.
STNG from 5 to 2. scam
SHORT all the way down. SHORT is guaranteed to win.
VaslavN profile picture
MATX is one of the best in the biz. Full disclosure: this ke'iki o' ka a'ina is a proud and faithful stakeholder. A hui hou. ;-)
Plimsoll profile picture
I think MATX will have a good quarter. Pasha is down one ship due to shipyard time and one ship helping out with Puerto Rico rebuilding, so their Hawaii overflow has to go on Matson ships.
Do you think SEA is a good long term investment at the current price?
J Mintzmyer profile picture
I’m not really a fan of the way SEA is structured, they are very heavily weighted into containers and there isn’t any sort of fundamental weighting that I can tell. Their performance has been abysmal over the past few years while we have easily exceeded those levels by utilizing fundamentals.
Powerful source, thx for education.
Thanks for the article..
i guess this very novice dfybulk shipping investor doesn't really see the great significance to the DSX write down of ship values. Doesn't this write down enable DSX to lower or eliminate write downs for the next several quarters at the very least? It is what it is. Looking at DSX specifically, they have 15 ships stacked up for re-charter over the next six weeks at very favorable rates. They are looking at being slightly profitable this year instead of a projected slight gain for next year.
Does this huge write down make DSX a 'no go' stock for the better informed?
J Mintzmyer profile picture
The write-down is non-cash. It doesn't change DSX's value at all, not one iota.

My point was to simply mention how a lot of investors will find these stocks and think leverage is low/stable or there is "Huge value" because they see a very low P/B. In reality, a lot of times, the leverage can actually be quite terrifying.

There have been firms with P/B ratios and D/A of like 0.2x and 40% who have went bankrupt.

That's why utilizing real-time valuations, like the ones provided from VesselsValue, can help folks make much more informed decisions.

DSX's latest action was simply them doing the right thing, bringing their balance sheet in-line with reality.
J Mintzmyer profile picture
The "Avoid Traps" wasn't speaking to DSX today, but rather saying how these values could be used going forward (or historically with DSX for example) to avoid falling into traps based on misleading asset statements on the balance sheet.
Blue Ridge Equity Research profile picture
nice advertisement.
J Mintzmyer profile picture
You could take that cynical viewpoint, or you could also see an overview of groundbreaking new analytics tools. Tools which they’ve agreed to share for use in some of our reports here on Seeking Alpha.

Furthermore, lots of investors don’t understand the difference between NAV and book value. This is a major issue for shipping investors.
Blue Ridge Equity Research profile picture
ive got no issue with native advertising, just say thats what it is....
James Catlin profile picture
Hello J.

Excellent point and examples about the need for accurate information. Real time data is the only reliable way to make real time decisions.

As you, and many of my readers know, I also utilize VesselsValue for a great deal of my research. It is an absolutely amazing service that goes well beyond what you were able to show in this article. I have been thoroughly impressed by the amount of information available as well as intuitive nature of the site. Well worth the money for any serious investor or researcher. Very happy to hear about these upcoming enhancements.
billgatesisevilus profile picture
Unfortunately, for those of us with a more limited research budged, VV is way too expensive to use. Having folks like yourself and J.Mintz use it and say what the found is very valuable to us.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

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