COSCO Shipping’s H1 results beat; interim dividend expected to back shares in near term – Morgan Stanley

 

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COSCO Shipping Holdings expects its net profit to reach 16.55 billion yuan in the first half of 2023, indicating a year-on-year slump of 74.47% and accounting for 50% of Morgan Stanley’s full-year estimate, the broker said in a note. That means its net profit in the second quarter of the year reached 9.42 billion yuan, with a first-half EBIT of 24.69 billion yuan.

The market anticipations suggested that the interim dividend should be able to support the share price of COSCO Shipping in the near term, but the industry hasn’t bottomed out, it said.

Considering the quarter-on-quarter drop in market spot freight rates, the company’s quarterly profit uptick is viewed as ahead of forecast, which should convert into solid interim dividends and serves as a short-term positive factor, the broker said.

Morgan Stanley kept the target price on COSCO Shipping at HK$5.6, and maintained the Underweight rating.