ZIM Integrated: Why I Wouldn't Buy More On This Dip (Rating Downgrade)

(8min)

Summary

  • ZIM Integrated Shipping has delivered a 29.5% total return since 2021, largely due to substantial dividend payouts, despite the stock's 58.48% nominal decline.
  • ZIM's Q3 results were impressive, with $2.77 billion in sales, 55% adjusted EBITDA margin, and strong cash flow from operating activities.
  • Despite brilliant results, I remain cautious about increasing my ZIM position due to the easing Red Sea crisis, which could pressure freight rates and future earnings.
  • I hold ZIM long-term, confident in management's strategy and regional diversification, but I anticipate further market challenges and prefer to wait.
  • Looking for a helping hand in the market? Members of Beyond the Wall Investing get exclusive ideas and guidance to navigate any climate. Learn More »

ZIM Mount Everest

Daniel Wright

My Thesis Update

If you have read me for some time, you know that I have been quite bullish on ZIM Integrated Shipping (NYSE:ZIM) since 2021. I think it should be a nice long-term pick

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This article was written by

6.76K Followers

Oakoff Investments is a personal portfolio manager and a quantitative research analyst with 5 years helping readers find a reasonable balance between growth and value by sharing proprietary Wall Street information.

He leads the investing group Beyond the Wall Investing with features that include: a fundamentals-based portfolio, weekly analysis on insights from institutional investors, regular alerts for short-term trade ideas based on technical signals, ticker feedback by request from readers, and community chat. Learn more.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of ZIM either through stock ownership, options, or other derivatives. 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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