This story originally appeared on Zacks
Genco Shipping & Trading Limited GNK is scheduled to release fourth-quarter 2021 results on Feb 24, before market open.
GNK has an appreciative surprise record as its earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, the average being 42.6%. The Zacks Consensus Estimate for fourth-quarter earnings has declined 1.6% to $1.89 over the past 60 days.
Against this backdrop, let’s discuss the factors that might have impacted Genco Shipping’s performance in the December quarter.
Bullishness surrounding the dry bulk market is a huge boon for Genco Shipping and is likely to have boosted its top line in the soon-to-be-reported quarter. Increased fleet utilization with the gradual resumption of economic activities and an uptick in world trade are likely to get reflected in Genco Shipping’s impending results. The Zacks Consensus Estimate for fourth-quarter fleet utilization is currently pegged at 98%, indicating growth from 97% recorded in fourth-quarter 2020.
On the flip side, COVID-related expenses and higher crew-related costs might have increased the daily vessel-operating expenses. This, in turn, is likely to have dented the bottom-line performance in the to-be-reported quarter.
What Does the Zacks Model Say?
Our proven model does not predict an earnings beat for Genco Shipping this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here as elaborated below. You can see the complete list of today’s Zacks #1 Rank stocks here.
Earnings ESP: Genco Shipping has an Earnings ESP of -9.00% as the Most Accurate Estimate is 17 cents below the Zacks Consensus Estimate of $1.89. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Genco Shipping currently carries a Zacks Rank #4 (Sell).
Highlights of Q3 Earnings
Genco Shipping’s third-quarter earnings (excluding 10 cents from non-recurring items) of $1.44 per share surpassed the Zacks Consensus Estimate of $1.32. Total revenues of $117.5 million, also beat the Zacks Consensus Estimate of $103.4 million
Within the broader Transportation sector, the likes of CSX Corporation CSX, Canadian National Railway CNI and GATX Corporation GATX reported fourth-quarter 2021 results last month.
CSX reported fourth-quarter 2021 earnings of 42 cents per share, which surpassed the Zacks Consensus Estimate by a penny. The bottom line improved in double digits year over year owing to higher revenues.
CSX’s total revenues of $3,427 million outperformed the Zacks Consensus Estimate of $3296 million. The top line improved 21.3% year over year on growth across all its businesses as well as revenues from Quality Carriers, which was acquired last July.
Canadian National reported fourth-quarter 2021 earnings (excluding 2 cents from non-recurring items) of $1.36 per share (C$1.71), which surpassed the Zacks Consensus Estimate of $1.21. The bottom line increased in double digits year over year on lower costs.
Canadian National’s quarterly revenues of $2,977.4 million (C$3,753 million) topped the Zacks Consensus Estimate of $2,917.4 million. The top line improved year over year, driven by higher freight rates and fuel surcharges.
GATX reported fourth-quarter 2021 earnings (excluding 11 cents from non-recurring items) of $1.58 per share, which surpassed the Zacks Consensus Estimate of $1.07. The bottom line surged more than 200% year over year.
GATX’s total revenues of $321 million increased 5.3% year over year, mainly owing to a 5.2% rise in lease revenues, which came in at $288.4 million. Lease revenues contributed 89.8% to the top line.
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Genco Shipping & Trading Limited (GNK): Free Stock Analysis Report
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