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ZIM Integrated Shipping: Long-Term Profitability Ahead
Summary
- Suez Canal re-opening will likely be later than ZIMs conservative Mid-2025 guidance in Q4 report.
- Geopolitical impacts (trade wars, decarbonization) on freight are widely overblown given the 2018+ tariff impacts of only -0.5% volume growth.
- “Pull-forward” effects have not led to an inventory glut and should not significantly impact 2025 peak season.
- Overcapacity in 2025+ will be an issue, but ZIM is set to outperform as slow steaming, blanking, idling, and scrapping will set a bottom on freight rates.
- ZIM can decrease spot exposure at profitable contract rates or return inefficient tonnage as charters come up for renewal.
I am an Engineer with experience in multiple industries. I am a retail trader with over 10 years of experience managing my own personal investments including ETFs, Options, REITs, Stocks, Cryptocurrency, Commodities, Bonds, CDs, and Futures. I am interested in moderate to high risk investment growth via a mix of traditional and contrarian index investing, higher-risk, short-term plays, and generally exploring the best ways to make money within the market. As are we all, I am seeking alpha (to beat the market). I currently have been interested in and following ZIM and the overall container shipping market. I have started analyzing and estimating ZIMs earnings via estimating average freight rate and volume each quarter based off of spot prices with relative success. I've been watching ZIM and believe it is extremely under-valued, so decided to start writing for Seeking Alpha to share some of my insights.
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.
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