Genco Shipping (GNK) AI Stock Analysis

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Genco Shipping

(NYSE:GNK)

69Neutral

Genco Shipping's solid financial performance, attractive valuation, and robust earnings call are key strengths, supported by a low P/E ratio and high dividend yield. The main risks include technical indicators signaling weak momentum and potential short-term headwinds in freight rates and operational costs.

Genco Shipping (GNK) vs. S&P 500 (SPY)

Market Cap

$541.29M

Dividend Yield11.59%

Average Volume (3M)811.54K

Price to Earnings (P/E)7.2

Beta (1Y)1.13

Revenue Growth10.21%

EPS GrowthN/A

CountryUS

Employees1,037

SectorIndustrials

Sector Strength66

IndustryMarine Shipping

Share Statistics

EPS (TTM)1.75

Shares Outstanding42,959,465

10 Day Avg. Volume906,637

30 Day Avg. Volume811,537

Financial Highlights & Ratios

PEG Ratio0.02

Price to Book (P/B)N/A

Price to Sales (P/S)1.38

Price to Cash Flow (P/CF)4.90

P/FCF Ratio4.90

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$18.75

Price Target Upside52.81% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering3

Genco Shipping Business Overview & Revenue Model

Company DescriptionGenco Shipping & Trading Limited, together with its subsidiaries, engages in the ocean transportation of dry bulk cargoes worldwide. The company owns and operates dry bulk carrier vessels to transports iron ore, coal, grains, steel products, and other dry-bulk cargoes. It charters its vessels primarily to trading houses, including commodities traders; producers; and government-owned entities. As of December 31, 2021, the company fleet consisted of 44 dry bulk carriers, including 17 Capesize, 15 Ultramax, and 12 Supramax with an aggregate capacity of approximately 4,636,000 deadweight tons. Genco Shipping & Trading Limited was incorporated in 2004 and is headquartered in New York, New York.

How the Company Makes MoneyGenco Shipping makes money through the chartering of its dry bulk vessels to customers under spot market voyages or time charters. Revenue is mainly generated from the hire rates paid by clients for the transportation of dry bulk commodities. The company's earnings are significantly influenced by the prevailing conditions in the dry bulk shipping market, which are driven by global demand and supply dynamics for commodities. Genco's revenue streams also depend on the efficient management of its fleet and strategic positioning of its vessels to capitalize on lucrative shipping routes. While the company may engage in partnerships with various chartering clients and maritime service providers, the core factor contributing to its earnings remains the freight rates in the dry bulk shipping market.

Genco Shipping Financial Statement Overview

Summary

Genco Shipping shows a strong gross profit margin and a healthy equity position with low leverage. Cash flow management is robust, yet profit margins and free cash flow consistency show room for improvement.

Income Statement

Positive

Genco Shipping has shown a strong gross profit margin of approximately 67.88% for 2024, indicating efficient cost management. However, the net profit margin is lower at 18.06%, showing potential challenges in controlling other expenses. Revenue has seen considerable growth from 2023 to 2024, but the previous year was marked by a net loss, indicating some volatility in earnings.

Balance Sheet

Positive

The company maintains a healthy equity position with a debt-to-equity ratio of 0.01, reflecting low leverage and reduced financial risk. The return on equity is strong at 8.24% for 2024, indicating effective use of equity capital. The equity ratio of approximately 87.72% reinforces the company's solid financial stability.

Cash Flow

Positive

Genco Shipping's cash flow analysis reveals a robust operating cash flow that significantly exceeds net income, with an operating cash flow to net income ratio of approximately 1.66. However, free cash flow growth has been inconsistent over the years, affecting the predictability of future cash generation.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
423.02M	383.82M	536.93M	547.13M	355.56M
	Gross Profit
116.68M	68.16M	196.26M	226.26M	35.68M
	EBIT
87.05M	-5.85M	167.24M	201.12M	7.63M
	EBITDA
159.90M	60.62M	230.06M	255.02M	-136.63M
	Net Income Common Stockholders
76.40M	-12.87M	158.58M	182.01M	-247.13M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
43.69M	46.54M	58.14M	114.57M	143.87M
	Total Assets
1.06B	1.14B	1.17B	1.20B	1.23B
	Total Debt
7.04M	194.26M	171.12M	246.29M	449.40M
	Net Debt
-36.65M	147.72M	112.98M	131.72M	305.53M
	Total Liabilities
128.37M	227.26M	205.56M	286.33M	487.81M
	Stockholders Equity
926.74M	913.26M	967.43M	916.59M	744.99M
Cash Flow		Free Cash Flow
70.17M	-2.23M	133.28M	113.66M	16.86M
	Operating Cash Flow
126.85M	91.78M	189.32M	231.12M	36.90M
	Investing Cash Flow
47.85M	-91.62M	-55.02M	-67.57M	37.44M
	Financing Cash Flow
-177.55M	-17.40M	-190.74M	-222.69M	-56.91M

Genco Shipping Technical Analysis

Technical Analysis Sentiment

Negative

Last Price12.27

Price Trends

50DMA

13.49

Negative

100DMA

13.93

Negative

200DMA

15.52

Negative

Market Momentum

MACD

-0.33

Negative

RSI

43.39

Neutral

STOCH

59.49

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GNK, the sentiment is Negative. The current price of 12.27 is below the 20-day moving average (MA) of 12.78, below the 50-day MA of 13.49, and below the 200-day MA of 15.52, indicating a bearish trend. The MACD of -0.33 indicates Negative momentum. The RSI at 43.39 is Neutral, neither overbought nor oversold. The STOCH value of 59.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for GNK.

Genco Shipping Risk Analysis

Genco Shipping disclosed 48 risk factors in its most recent earnings report. Genco Shipping 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

Genco Shipping Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SBLK	72 Outperform	$1.62B	4.92	14.71%	15.52%	33.31%	62.94%
GOGL	69 Neutral	$1.43B	6.42	11.68%	14.66%	9.33%	98.70%
GNK	69 Neutral	$541.29M	7.20	8.30%	11.59%	10.21%	―
SFL	67 Neutral	$1.14B	7.76	12.05%	13.85%	20.22%	52.03%
SB	66 Neutral	$347.39M	3.97	11.99%	6.06%	8.17%	35.92%
NAT	62 Neutral	$531.49M	11.26	8.91%	13.54%	-2.37%	-52.77%
Sector *	62 Neutral	$4.13B	11.17	5.46%	215.76%	4.12%	-8.54%

* Industrials Sector Average

Performance Comparison

GNK

Genco Shipping

12.27

-6.88

-35.93%

NAT

Nordic American Tanker

2.45

-0.94

-27.73%

Safe Bulkers

3.22

-1.43

-30.75%

SFL

SFL Corporation

7.79

-3.77

-32.61%

SBLK

Star Bulk Carriers

13.59

-7.53

-35.65%

GOGL

Golden Ocean Group

7.12

-4.73

-39.92%

Genco Shipping Earnings Call Summary

Earnings Call Date: Feb 19, 2025 | % Change Since: -14.20% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Positive

The earnings call reflects a robust financial performance in 2024 with significant growth in EBITDA, dividends, and fleet modernization. However, there are challenges in the form of downward volatility in early 2025 freight rates and a high drydocking year. The company's strong financial position and low leverage provide a buffer against these challenges.

Highlights

Strong Financial Performance in 2024

Genco's EBITDA exceeded $150 million, a nearly 50% increase from 2023 levels. The company also increased time charter equivalent rates to $19,107 per day from $14,766 the prior year.

Significant Dividend Increase

Genco increased distributions to shareholders by 70%, declaring $1.46 per share in dividends during the year, maintaining a strong track record of providing dividends through market cycles.

Fleet Expansion and Modernization

Acquired a high specification Capesize vessel, Genco Intrepid, as part of the fleet renewal strategy, increasing investment in modern vessels to $285 million since 2021.

Low Financial Leverage

Industry-low net loan to value of 5% and over $330 million in undrawn revolver availability, indicating strong financial health and flexibility.

Lowlights

Downward Volatility in Early 2025

The beginning of 2025 saw downward volatility in the dry bulk market due to seasonal factors, impacting near-term freight rates.

Challenges in Freight Rates

Despite strong fundamentals, Genco has faced softening freight rates, particularly affecting the first quarter of 2025.

High Drydocking Year in 2025

Anticipation of a high drydocking year, which could impact fleet utilization and operational costs in 2025.

Company Guidance

During the Genco Shipping & Trading Limited fourth quarter 2024 earnings call, several key metrics and strategic decisions were highlighted. The company reported an EBITDA exceeding $150 million, marking a nearly 50% increase from the previous year, with time charter equivalent (TCE) rates rising to $19,107 per day from $14,766. Genco noted a 70% increase in shareholder distributions, declaring $1.46 per share in dividends for 2024, with a fourth-quarter dividend of $0.30 per share, marking their 22nd consecutive dividend. They emphasized their strong financial position with a low net loan-to-value of 5% and over $330 million in undrawn revolver availability. In 2024, Genco voluntarily reduced its debt by $110 million, expecting a $6 million annualized interest expense reduction. Looking ahead, they have fixed 75% of their Q1 2025 days at $12,366 per day, with a cash flow breakeven rate of $8,873 per vessel per day, while planning to frontload drydockings in the first half of 2025. The company continues to capitalize on market opportunities by acquiring high-specification Capesize vessels, aligning with its value strategy of dividends, deleveraging, and growth.

Genco Shipping Corporate Events

Business Operations and StrategyFinancial Disclosures

Genco Shipping Updates Q1 2025 TCE Rate Estimate

Positive

Mar 14, 2025

Genco Shipping provided an update on its estimated time charter equivalent (TCE) rate for the first quarter of 2025, estimating it to be approximately $11,700 per day for about 95% of its owned available days. The company noted that freight rates, particularly for Capesize vessels, have increased significantly in March 2025, benefiting their operations as most of their fleet trades in the spot market. Some revenue from first-quarter fixtures will be recognized in the second quarter due to accounting practices, and daily vessel operating expenses are estimated at $6,500 per vessel per day.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.