Navios Maritime Partners: Weighing Its Net Asset Value and Stock

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Part 9
Navios Maritime Partners: Weighing Its Net Asset Value and Stock PART 9 OF 9

What Are Analysts Recommending for Navios Maritime’s Stock?

Analyst ratings

Currently, 12 analysts are covering Navios Maritime Partners (NMM). Of them, three analysts have “buy” recommendations, seven have “hold” recommendations, and two have “sell” recommendations.

In comparison, Diana Shipping (DSX) has “buy” ratings from 10% of the analysts covering its stock. Ship Finance International (SFL) and Navios Maritime Holdings (NM) have “buy” ratings from 75% and 25% of analysts, respectively. SFL forms 3.3% of the Guggenheim Shipping ETF (SEA), which invests in major shipping companies around the world. The SPDR Metals and Mining ETF (XME) provides exposure to the metals and mining space.

What Are Analysts Recommending for Navios Maritime&#8217;s Stock?

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Rating changes

While JPMorgan Chase cut the dry cargo rate expectations, it upgraded NMM and SALT to “buy” on January 26, 2016. It suggests that the sell-down of Navios Maritime Partners is overdone given its high charter coverage and low leverage.

Morgan Stanley upgraded NMM to “equal-weight” from “underweight.” It believes NMM’s current distributions can be sustained until at least the end of 2017.

Deutsche Bank, on the other hand, maintained its “buy” rating, but cut its target price from $15 to $8.50, reflecting the lower distribution yield. Clarksons Platou Securities cut its target price from $9 to $6 while maintaining its “neutral” rating.

Analyst estimates

Analysts are estimating sales of $226.8 million for 2016 and EBITDA (earnings before interest, tax, depreciation, and amortization) of $149.6 million. This is lower than its figures in 2014, as the graph above shows. This is despite the acquisition of container vessels during late 2014 and 2015. Analysts are most likely factoring in the risk of rechartering for NMM’s dry bulk vessels. Navios Maritime Partners’ 15 dry vessels are off charter until June 2016. Given the current state of the dry bulk market and tepid outlook, the rechartered rates on these vessels are expected to be lower than the rates at which the current charters will expire. However, the company’s distribution coverage is still greater than one, as we’ve discussed in Does Navios Maritime Partners’ Stock Have Still More Downside?

To follow up on the direction of rates and their likely impact on the dry bulk equities, please visit our Dry Bulk Shipping page.


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