BTIG downgraded Eagle Bulk Shipping (EGLE), Golden Ocean (GOGL) and Genco Shipping (GNK) to Neutral from Buy. While spot cape rates are in the $30,000 range, this looks to be more a function of dislocations in the Atlantic basin which has done little to help Supramax rates which are in the $13,000 range, the analyst tells investors in a research note. Looking ahead, with iron ore and coal demand expected to be flat to up and total seaborne drybulk trade growth expected to slow to 1%-2% from 4%-5% in 2023, 2024 is shaping up to be a challenging year for drybulk stocks, contends BTIG. The firm calls the stocks “value traps for now.” While the shares appear cheap on a net asset value basis, cash flow yields look set to drop roughly 500 basis points in 2024, says the firm.
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