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Danaos (DAC) to Report Q1 Earnings: What's in the Offing?

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Danaos Corporation (DAC - Free Report) is scheduled to release first-quarter 2020 results on May 18, after market close.

The company’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, the average being 13.7%.

Danaos Corporation Price and EPS Surprise

 

Danaos Corporation Price and EPS Surprise

Danaos Corporation price-eps-surprise | Danaos Corporation Quote

Moreover, the Zacks Consensus Estimate for first-quarter earnings has been stable at $1.19 per share over the past 60 days.

Against this backdrop, let’s examine the factors that are likely to have impacted the company’s March-quarter performance.

Danaos’ first-quarter performance is expected to have been affected by coronavirus-induced supply-chain disruptions. Notably, the coronavirus pandemic spelt doom for the shipping industry, which is responsible for transporting the majority of goods involved in world trade and is rightfully considered the life line of the global economy.

However, the increase in tanker freight rates following Saudi Arabia’s decision to charter multiple super-tankers for shipping crude oil to customers across the globe is likely to have boosted the company’s first-quarter performance. The plunge in oil prices (by 66.5%) during the January-March period is a bonus and is expected to have supported the bottom line in the to-be-reported quarter.

What Does the Zacks Model Say?

Our proven model does not conclusively predict an earnings beat for Danaos this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of a positive surprise. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Danaos has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Danaos carries a Zacks Rank #2, currently.

Highlights of Q4 Earnings

In the last reported quarter, Danaos’ earnings (excluding 22 cents) of $2.01 per share surpassed the Zacks Consensus Estimate of $1.67. However, the bottom line declined 20.2% on a year-over-year basis. Quarterly revenues of $110.2 million surpassed the Zacks Consensus Estimate of $103.2 million.

Stocks to Consider

Investors may consider Allegiant Travel Company (ALGT - Free Report) ,Covetrus (CVET - Free Report) and Baidu (BIDU - Free Report) as these stocks have the right combination of elements to beat on earnings this reporting cycle.

Allegiant has an Earnings ESP of +0.69% and a Zacks Rank of 3. The company will report first-quarter 2020 earnings on May 12.

Covetrus has an Earnings ESP of +41.67% and a Zacks Rank #3. The company will report first-quarter 2020 earnings on May 14.

Baidu has an Earnings ESP of +4.45% and is Zacks#3 Ranked. The company will report first-quarter 2020 earnings on May 18.

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