A. P. Møller Mærsk (Hold, TP: DKK12100.00) - Rapid unit cost response
Maersk’s Q1 results were supported by unit cost improvement, partly offsetting the 26% QOQ drop in average loaded freight rates. We maintain our negative view on container market prospects and believe the recent bounce in rates is driven by synthetic supply impulses to be regarded with suspicion. We note the bleak macroeconomic environment and mass tonnage influx from the record orderbook have yet to materially affect the market, which is already struggling with net spot freight rates below pre-pandemic levels. Maersk remains solid, but its buybacks will be tested during 2024, in our view. We reiterate our HOLD, but have cut our target price to DKK12,100 (12,400).A.P. Moeller Maersk is an international shipping company. Co.'s operating segments are: Container shipping and related activities which include global container services, inland transportation, manufacturing and repair of containers and container depots, and logistics and forwarding activities; APM terminals; Tankers, offshore and other shipping activities which include tanker shipping of crude oil, oil products and gas, offshore drilling activities and operation of land rigs, supply vessel activities with anchor handling and platform supply vessels, ferry services and door-to-door transportation in Northern Europe; Oil and gas activities; Retail activity; and Shipyards and other activities.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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