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Danaos (DAC)
NYSE:DAC
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Danaos
(NYSE:DAC)
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Rating:81Outperform
Price Target:
$119.00
â–²(18.80% Upside)
The score is driven primarily by strong financial performance and a positive earnings-call outlook with high contracted revenue visibility and conservative net leverage. Valuation is a major tailwind given the very low P/E and solid dividend yield. Technicals are supportive with price above key moving averages, while the main risks are cash flow variability, increased debt versus 2024, and cost/spot-exposure-driven volatility.
Positive Factors
Fleet Expansion
The addition of new eco-friendly vessels enhances Danaos' fleet capacity and market competitiveness, supporting long-term revenue growth and compliance with emission standards.
Strong Cash Generation
Strong cash generation supports financial flexibility, enabling strategic investments and debt management, which are crucial for long-term stability.
Solid Balance Sheet
A low debt-to-equity ratio indicates conservative leverage, providing financial stability and reducing risk, which is beneficial for long-term operations.
Negative Factors
Decreased Net Income
A decrease in net income, despite revenue growth, suggests rising costs or inefficiencies, which could pressure profitability if not addressed.
Increased Operating Costs
Rising operating costs can erode margins and profitability, potentially impacting the company's ability to sustain its competitive advantage.
Decline in Profit Margins
A decline in profit margins may indicate cost pressures or pricing challenges, which could affect long-term profitability if not managed effectively.
Danaos (DAC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.98B
Dividend Yield3.64%
Average Volume (3M)75.01K
Price to Earnings (P/E)4.0
Beta (1Y)0.74
Revenue Growth3.82%
EPS Growth-13.73%
CountryUS
Employees4
SectorIndustrials
Sector Strength72
IndustryMarine Shipping
Share Statistics
EPS (TTM)7.14
Shares Outstanding18,309,654
10 Day Avg. Volume80,042
30 Day Avg. Volume75,008
Financial Highlights & Ratios
PEG Ratio1.35
Price to Book (P/B)0.46
Price to Sales (P/S)1.67
P/FCF Ratio5.39
Enterprise Value/Market Cap1.08
Enterprise Value/Revenue2.04
Enterprise Value/Gross Profit3.05
Enterprise Value/Ebitda2.98
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Danaos Business Overview & Revenue Model
Company DescriptionDanaos Corporation, together with its subsidiaries, owns and operates containerships in Australia, Asia, Europe, and the United States. The company offers seaborne transportation services, such as chartering its vessels to liner companies. As of February 28, 2022, it had a fleet of 71 containerships aggregating 436,589 twenty-foot equivalent units in capacity. The company was formerly known as Danaos Holdings Limited and changed its name to Danaos Corporation in October 2005. Danaos Corporation was founded in 1963 and is based in Piraeus, Greece.
How the Company Makes MoneyDanaos generates revenue primarily through the long-term leasing of its containership fleet to major shipping companies. The company enters into time charters, which are contracts that provide customers with the use of its vessels for a specified period, typically ranging from several months to many years. This model results in predictable cash flows and stable earnings. Additionally, Danaos benefits from its strategic partnerships with leading shipping lines, which helps secure long-term contracts and maintain high fleet utilization rates. The company may also experience revenue fluctuations based on market conditions, such as shipping rates and demand for container transportation, but the long-term charter agreements help mitigate this risk.
Danaos Earnings Call Summary
Earnings Call Date:Feb 09, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 18, 2026
Earnings Call Sentiment Positive
Overall the call presents a positive strategic and financial position: the company strengthened its contracted backlog to $4.3 billion with strong contract coverage, executed attractive financing, maintained robust liquidity ($1.4 billion) and low net leverage (net debt / EBITDA 0.2x), and announced sizeable shareholder returns (a $90 per share dividend and buyback program). The primary negatives were modest year-over-year decline in adjusted net income (~1.6%), rising operating and G&A costs (G&A +30.9%), higher interest expense due to increased indebtedness, and only marginal EBITDA growth (+0.2%). Management’s decision to keep certain dry bulk vessels exposed to spot/index markets adds potential earnings volatility. On balance, the positives (backlog, liquidity, financing, fleet orders, and shareholder returns) outweigh the operational and cost-related headwinds.Q4-2025 Updates
Positive Updates
Contract Backlog and Coverage Expansion
Total contract revenue/backlog increased to $4.3 billion with a 4.3-year average charter duration. Contract coverage stood at 100% for 2026, 87% for 2027 and 64% for 2028 (in terms of operating days), improving forward revenue visibility.
Fleet Orders and Long-Term Charters
Ordered six 1,800 TEU container vessels, four 5,300 TEU vessels, and two 211,000 dwt Newcastle MAX dry bulk vessels for 2028–2029 delivery; ten-year charters secured for four of the newbuilds.
Strong Liquidity and Conservative Leverage
Year-end cash of $1.0 billion and total liquidity of $1.4 billion (including RCF availability and marketable securities). Net debt was $141 million, translating to net debt / adjusted EBITDA of 0.2x; 61 of 85-vessel fleet unencumbered and debt-free.
Attractive Financing Execution
Completed a seven-year €500 million unsecured bond issuance at a 6.875% coupon — highlighted as one of the most competitively priced unsecured shipping bonds of that tenor, diversifying capital sources.
Adjusted EPS and Adjusted EBITDA
Adjusted EPS was $7.14 per share (vs. $6.93 prior), representing ~3.0% increase in EPS. Adjusted EBITDA was $190.0 million, up $0.3 million or 0.2% year-over-year.
Revenue Drivers and Fleet Utilization
Operating revenues increased by $8.1 million versus prior period. Contributions included $5.2 million from an expanded containership fleet, $10.5 million from higher fleet utilization, and $2.2 million from higher dry bulk charter income.
Shareholder Returns and Capital Actions
Declared a dividend of $90 per share for the quarter and continue executing a $300 million share repurchase program with $65 million remaining authority.
Strategic Energy Investments
Became a strategic investor in the Alaska LNG project (planned ~20 mtpa). Management expects project completion timing around 2030 with an estimated 6–10 ships required and potential ~20-year employment for project-related charters.
Negative Updates
Small Decline in Adjusted Net Income
Adjusted net income decreased to $131.2 million from $133.3 million, a decline of $2.1 million (≈1.6%) year-over-year despite higher EPS (driven by share count/other adjustments).
Container Segment Revenue Pressure
Container segment revenues declined by $7.8 million due to lower contracted charter rates; additionally, $2.0 million lower non-cash U.S. GAAP revenue recognition negatively impacted reported revenues.
Rising Operating and SG&A Costs
Daily vessel operating cost rose to $6,377 from $6,135 (≈+3.9%). G&A expenses increased $6.7 million to $28.4 million (≈+30.9%), primarily driven by incremental stock and cash bonus awards (~$6.6 million).
Higher Interest Expense from Increased Indebtedness
Interest expense (excluding amortization) increased by $4.2 million to $13.4 million (≈+45.7% vs. $9.2 million), reflecting roughly $400 million higher average indebtedness; partially offset by ~50 bps reduction in debt cost and higher interest income.
Adjusted EBITDA Essentially Flat
Adjusted EBITDA rose only 0.2% ($0.3 million) to $190.0 million year-over-year, signaling limited operating leverage despite backlog expansion and higher utilization.
Spot Exposure on Dry Bulk Strategy
Management intends to keep newly ordered Newcastle MAX and many Capesize vessels mainly exposed to the spot/index market rather than locking-in medium-term charters, which could increase earnings volatility if dry bulk rates weaken.
Increased Fleet-Related Operating Costs
An increase in the average number of vessels in the fleet contributed to higher total operating costs (management cited fleet growth as a main driver).
Company Guidance
Management's guidance emphasized strong forward visibility and measurable commitments: total contract revenue rose to $4.3 billion with a 4.3‑year average charter duration and contract coverage of 100% for 2026, 87% for 2027 and 64% for 2028 (having added $428 million to the contracted backlog since the last release); the company has ordered six 1,800 TEU and four 5,300 TEU container newbuilds plus two 211,000 dwt Newcastle MAX dry bulk newbuilds for 2028–29 (four of those secured on ten‑year charters), is pursuing LNG opportunities tied to an Alaska LNG project targeting 2030 completion with 6–10 ships and ~20‑year employment, completed a seven‑year €500 million unsecured bond at a 6.875% coupon, ended the period with $1.0 billion cash and $1.4 billion total liquidity, net debt of $141 million (net debt / adjusted EBITDA 0.2x), an 85‑vessel fleet with 61 unencumbered vessels (plus 16 encumbered under the RCF but undrawn), and continues shareholder returns with a $90 per‑share dividend and a $300 million buyback program with $65 million remaining; reported operating metrics included adjusted EPS of $7.14 and adjusted net income of $131.2 million, adjusted EBITDA of $190 million, vessel opex of $6,377 per vessel per day, G&A of $28.4 million, interest expense (ex amortization) of $13.4 million and interest income of $8.5 million.Danaos Financial Statement Overview
Summary
Strong profitability and 2025 re-acceleration (high net and EBITDA margins; revenue up ~78% YoY) support the score. This is tempered by cyclical normalization from peak years, a notable 2025 debt increase, and uneven free cash flow (including negative FCF in 2024).Income Statement
Profitability is very strong for a shipping company, with 2025 revenue of about $1.04B and a high net margin (~47%) alongside robust EBITDA margin (~72%). Growth re-accelerated materially in 2025 (revenue up ~78% YoY) after a relatively flat 2023–2024. Offsetting this strength, profitability has trended down from peak 2021–2023 levels (net margin was ~59% in 2023 and unusually elevated in 2021), suggesting earnings can be cyclical and sensitive to market conditions.82
Very Positive
Balance Sheet
The balance sheet looks solid with meaningful equity ($3.80B in 2025) and moderate leverage (debt-to-equity ~0.30 in 2025), which is a comfortable level for the industry. Return on equity remains healthy (~13% in 2025), though it has declined from stronger 2022–2023 levels as profitability normalized. A key watch item is the step-up in total debt in 2025 (to ~$1.16B from ~$0.73B in 2024), which reduces flexibility versus the prior year even though leverage remains manageable.78
Positive
Cash Flow
Cash generation is good but uneven. Operating cash flow was strong in 2025 (~$619M) and exceeded net income (about 1.54x), indicating solid cash conversion. However, free cash flow has been volatile: negative in 2024 and lower in 2025 (~$322M), with a sharp reported decline in 2025 free cash flow growth. Overall, the business is producing cash, but free cash flow variability suggests sensitivity to capital spending and working-capital swings.66
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.04B | 1.01B | 973.58M | 993.34M | 689.50M |
| Gross Profit | 833.68M | 615.94M | 641.17M | 664.96M | 412.39M |
| EBITDA | 748.62M | 675.07M | 704.83M | 717.17M | 1.22B |
| Net Income | 494.61M | 505.07M | 576.30M | 559.21M | 1.05B |
Balance Sheet | |||||
| Total Assets | 5.11B | 4.34B | 3.66B | 3.40B | 3.63B |
| Cash, Cash Equivalents and Short-Term Investments | 1.04B | 514.23M | 357.84M | 267.67M | 552.43M |
| Total Debt | 1.16B | 734.78M | 404.17M | 529.42M | 1.34B |
| Total Liabilities | 1.32B | 918.85M | 644.82M | 839.81M | 1.54B |
| Stockholders Equity | 3.80B | 3.42B | 3.02B | 2.56B | 2.09B |
Cash Flow | |||||
| Free Cash Flow | 322.29M | -37.59M | 308.26M | 735.61M | 72.39M |
| Operating Cash Flow | 618.98M | 621.75M | 576.29M | 934.74M | 428.11M |
| Investing Cash Flow | -325.70M | -650.79M | -338.53M | 176.57M | -143.15M |
| Financing Cash Flow | 290.62M | 210.61M | -233.62M | -973.40M | -220.87M |
Danaos Technical Analysis
Positive
100.17
Price Trends
99.60
Positive
95.08
Positive
91.64
Positive
Market Momentum
2.49
Negative
71.58
Negative
92.10
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DAC, the sentiment is Positive. The current price of 100.17 is below the 20-day moving average (MA) of 104.29, above the 50-day MA of 99.60, and above the 200-day MA of 91.64, indicating a bullish trend. The MACD of 2.49 indicates Negative momentum. The RSI at 71.58 is Negative, neither overbought nor oversold. The STOCH value of 92.10 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DAC.
Danaos Risk Analysis
Danaos disclosed 65 risk factors in its most recent earnings report. Danaos reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Danaos Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $1.98B | 4.04 | 13.70% | 3.64% | 3.82% | -13.73% | |
81 Outperform | $1.40B | 3.51 | 26.18% | 6.16% | 7.13% | 23.37% | |
76 Outperform | $2.06B | 6.00 | 16.57% | 2.94% | -29.82% | -16.77% | |
76 Outperform | $1.86B | 6.73 | 8.81% | 0.39% | -1.33% | -33.66% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | $3.50B | 3.49 | 25.25% | 20.35% | 1.63% | -30.30% | |
59 Neutral | $1.44B | -51.57 | -2.53% | 12.24% | -11.10% | -101.57% |
* Industrials Sector Average
DAC
Danaos
109.98
29.63
36.88%
CMRE
Costamare
17.19
9.88
135.22%
GSL
Global Ship Lease
40.26
19.24
91.53%
NMM
Navios Maritime Partners
68.26
25.22
58.59%
SFL
SFL Corporation
10.74
2.38
28.41%
ZIM
ZIM
29.27
12.41
73.55%
Danaos Corporate Events
Danaos Joins Glenfarne in $50 Million Alaska LNG Partnership and LNG Carrier Build-Out
Jan 20, 2026
On January 20, 2026, Danaos Corporation announced a strategic partnership with Glenfarne Group to support the development of the Alaska LNG Project, marking a significant expansion of Danaos’s presence in LNG and broader energy shipping. Under the agreement, Danaos will make a $50 million development capital equity investment in Glenfarne Alaska Partners LLC and serve as the preferred tonnage provider to build and operate at least six LNG carriers for Glenfarne Alaska LNG, LLC, positioning Danaos to tap into long-term LNG transport demand linked to Alaska’s phased pipeline and liquefaction export scheme and deepening its role in North Pacific energy trade for the benefit of both its fleet deployment strategy and LNG market stakeholders.
The most recent analyst rating on (DAC) stock is a Buy with a $113.00 price target. To see the full list of analyst forecasts on Danaos stock, see the DAC Stock Forecast page.
Danaos Corporation Reports Revenue Growth Amid Fleet Expansion
Nov 18, 2025
In its latest financial report for the three months ended September 30, 2025, Danaos Corporation reported a 1.8% increase in operating revenues, reaching $260.7 million compared to the same period in 2024. The growth was driven by new vessel additions and improved fleet utilization, although offset by lower charter rates. The company also experienced a decrease in voyage expenses and an increase in vessel operating expenses due to fleet expansion. Notably, Danaos reported a gain on investments and a stable financial position despite an increase in outstanding debt, reflecting strategic investments in fleet capacity.
The most recent analyst rating on (DAC) stock is a Buy with a $98.00 price target. To see the full list of analyst forecasts on Danaos stock, see the DAC Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.