Eagle Bulk Shipping (EGLE) – Top line results surpass recently-lowered expectations but so do costs

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Monday, November 07, 2022

Eagle Bulk Shipping Inc. (“Eagle”) is a US-based drybulk owner-operator focused on the Supramax/Ultramax mid-size asset class, which ranges from 50,000 and 65,000 deadweight tons in size; these vessels are equipped with onboard cranes allowing for the self-loading and unloading of cargoes, a feature which distinguishes them from the larger classes of drybulk vessels and provides for greatly enhanced flexibility and versatility- both with respect to cargo diversity and port accessibility. The Company transports a broad range of major and minor bulk cargoes around the world, including coal, grain, ore, pet coke, cement, and fertilizer. Eagle operates out of three offices, Stamford (headquarters), Singapore, and Hamburg, and performs all aspects of vessel management in-house including: commercial, operational, technical, and strategic.

Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Eagle reported 2002-3Q Net Revenues of $185.3 million on TCE rates of $28,099. We had recently lowered our net revenue estimate to $158.9 million based on an assumed TCE rate to $25,000. Higher-than-expected revenues reflect a high level of charter-in days (1000 versus our 600 assumption) and an impressive utilization rate of 99.7%. The company has 70% of fourth-quarter available days covered at $25,040 which compares favorably with our models.

But costs were higher. Eagle reported 2002-3Q voyage expenses of $40.8 million versus $30.3 million last year and our estimate of $25.6 million. Voyage operating expenses were $33.1 million versus $28.1 million and our $27.5 million estimate. G&A expenses were $9.7 million versus $7.9 million and our $8.4 million estimate.  Higher costs reflect industry trends but bear watching going forward.

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This Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).


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