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How Will Grindrod Shipping (GRIN) Fare This Earnings Season?

Zacks Equity Research
·4-min read

Grindrod Shipping Holdings Ltd. GRIN is scheduled to release third-quarter 2021 earnings on Nov 17, after market close.

The Zacks Consensus Estimate for third-quarter earnings has been revised 2.98% upward over the past 60 days to $2.09. The consensus mark for revenues is currently pegged at $117.33 million.

Given this backdrop, let’s discuss the factors that might have impacted the company’s performance in the September quarter.

With the gradual resumption of economic activities, the world trade picked up the pace, which in turn, is likely to aid the third-quarter results of shipping stocks like Grindrod Shipping. This is because the shipping industry is responsible for transporting an enormous proportion of goods involved in world trade.

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The bullish sentiment surrounding the Drybulk market is likely to have boosted Grindrod Shipping’s top line in the to-be-reported quarter. Revenues are likely to have increased owing to favorable Drybulk freight rates. However, we expect GRIN’s third-quarter bottom-line performance to have been hurt by escalated time charter and voyage expenses. A sharp rise in oil price is augmenting fuel costs. This, in turn, is likely to have jacked up the operating costs in the to-be-reported quarter.

Moreover, the Delta-variant-induced operational hazards are likely to have hampered the shipping company’s performance in the September quarter.

Earnings Whispers

The proven Zacks model does not predict an earnings beat for Grindrod Shipping this time around. This is because the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Grindrod Shipping has an earnings ESP of 0.00% as the Most Accurate Estimate is in line with the Zacks Consensus Estimate of $2.09. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Grindrod Shipping sports a Zacks Rank of 1, currently.

Highlights of Q2 Earnings

Grindrod Shipping reported second-quarter earnings of $1.01 per share, up 417%, sequentially. Total revenues of $159 million more than doubled sequentially.

Stocks to Consider

Investors interested in the broader Transportation  sector may consider Diana Shipping DSX and Copa Holdings CPA as these stocks possess the right combination of elements to beat on earnings this reporting cycle.

Diana Shipping has an Earnings ESP of +5.88% and a Zacks Rank #2, presently. DSX will release third-quarter 2021 results on Nov 17. The Zacks Consensus Estimate for third-quarter earnings has remained stable at 17 cents over the past 30 days. Shares of DSX have surged 214.9% in a year’s time compared with the 80.7% increase of its industry.

While steep fuel costs are likely to have affected Diana Shipping’s bottom line, increased time-charter revenues are likely to have boosted its top line in the September quarter. Time-charter revenues are likely to have increased owing to the uptick in the average time-charter rates for DSX’s vessels during the quarter.

Copa Holdings has an Earnings ESP of +11.77% and a Zacks Rank #3 at present. CPA is scheduled to report third-quarter 2021 earnings numbers on Nov 17. The Zacks Consensus Estimate for third-quarter earnings has been revised 54.1 upward over the past 60 days. Shares of this Latin-American carrier have gained 15.4% in a year’s time compared with the 7.5% increase of its industry.

Driven by factors like ramped-up vaccination, gradual revival of the economic activities, buoying consumer confidence in Latin America, passenger revenues are likely to have improved at Copa Holdings in the September quarter.


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Grindrod Shipping Holdings Ltd. (GRIN) : Free Stock Analysis Report
 
Diana Shipping inc. (DSX) : Free Stock Analysis Report
 
Copa Holdings, S.A. (CPA) : Free Stock Analysis Report
 
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Zacks Investment Research