Back to top

Image: Bigstock

ZIM (ZIM) Moves 7.5% Higher: Will This Strength Last?

Read MoreHide Full Article

ZIM Integrated Shipping Services (ZIM - Free Report) shares ended the last trading session 7.5% higher at $14.45. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 36.2% gain over the past four weeks.

The uptick followed an upgrade of the stock by Jefferies to buy from hold as the Red Sea crisis — and the Middle East situation in general — is worsening. While upgrading the stock Jefferies shipping analyst Omar Nokta said “Red Sea diversions are on the rise as continued attacks on vessels in the region are prompting more shipping companies to avoid transiting the area.” Regarding ZIM, which is based in Israel, the analyst is of the view that the company's "story has changed... with cash burn shifting to significant cash generation."

This container shipping company is expected to post quarterly loss of $1.33 per share in its upcoming report, which represents a year-over-year change of -138.7%. Revenues are expected to be $1.23 billion, down 44% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

For ZIM, the consensus EPS estimate for the quarter has been revised 110.6% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on ZIM going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

ZIM belongs to the Zacks Transportation - Shipping industry. Another stock from the same industry, Seanergy Maritime Holdings Corp (SHIP - Free Report) , closed the last trading session 4% lower at $7.69. Over the past month, SHIP has returned 2.3%.

For Seanergy Maritime Holdings Corp, the consensus EPS estimate for the upcoming report has changed -137.1% over the past month to $0.16. This represents a change of +220% from what the company reported a year ago. Seanergy Maritime Holdings Corp currently has a Zacks Rank of #3 (Hold).

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Seanergy Maritime Holdings Corp (SHIP) - free report >>

ZIM Integrated Shipping Services Ltd. (ZIM) - free report >>

Published in