Cailianshe reported on April 6 that after Yuntianhua (600096, SH), shipping giant China COSCO Shipping (601919, SH) has also joined the "big handsome" camp of A-share listed companies (net profit in the first quarter is expected to increase by ≥50 times). It is worth noting that some securities companies have predicted that , China COSCO Shipping will make more than 10 billion yuan in the first quarter, and raised its target price to double.
China COSCO Shipping announced today that the company's net profit in the first quarter is expected to reach 15.45 billion yuan, compared with only 292 million yuan in the same period last year.
Regarding the main reasons for the expected increase in performance in this period, China COSCO Shipping announcement stated that during the reporting period, the average value of China's export container freight index (CCFI) was 1960.99 points, an increase of 113.33% compared with the same period last year and 53.8% compared with the fourth quarter of the previous year.
A number of investors said they "can't believe it" about such impressive performance. Some people said, "It is very likely that the decimal point was written incorrectly. The revenue of 15 billion yuan in a single quarter was really beyond imagination." Some people were curious, "How did you make this money? How could you make so much money in the first quarter?"
From the perspective of the consistent expectations of securities companies, institutions consistently expect China COSCO Shipping 's full-year net profit in 2021 is approximately about 26.683 billion yuan. The company's first quarter report is expected to increase by more than 15 billion yuan, which has reached 58% of the annual net profit target expected by the institutions, with a slight chance of "achieve all the results".
On the evening of March 30, the annual report released by China COSCO Shipping showed that in 2020, the operating income of China COSCO Shipping was 171.259 billion yuan, a year-on-year increase of 13.37%; the net profit attributable to shareholders of listed companies was 9.927 billion yuan, a year-on-year increase of 46.76%.
The next day, a research report by CITIC Construction Investment on March 31 pointed out that due to the impact of the new crown epidemic, Oriental Overseas International has made provisions for the long-term service agreement for the Long Beach container terminal. This item is included in the transportation costs of equipment and goods, affecting the current net profit, so the company's core profit far exceeds 9.9 billion.
European and American demand is booming, and the annual freight rate may remain high. Recently, due to the very strong cargo volume of the US line, some airlines have raised prices slightly. The European line has also seen a liquidation situation recently. The chain reaction of congestion in the Suez Canal will begin to appear in the second half of April, and the European line may usher in a new price increase window after late April.
CICC believes that it is highly likely that , COSCO Shipping profit exceeded 10 billion in the first quarter. In addition, the second quarter started well, and the long-term price part took effect. The continuous recovery of the goods volume will lead to high freight rates, and the profit level in the second quarter may be no less than that in the first quarter. The third quarter has entered the traditional peak season, and profitability will further increase with the increase in the long-term chassis.
CICC expects the company's operating income in 2021/2022 to be 236.6 billion yuan and 218.8 billion yuan, respectively, and net profits to be 43.3 billion yuan and 28.3 billion yuan, respectively. 's current integrated operation industry is in a highly profitable state, and it will give an 8-fold valuation in 2021 (a 20% off the original valuation of 10 times), corresponding to a market value of about 350 billion yuan. It will continue to maintain the company's "buy" rating and raise the target price by 18.3 to 28 yuan, which is about 130% room compared with the current stock price.
In terms of risk factors, CICC said that judging from the current situation, the freight rates of the main routes are at historical highs, and it is a matter of time for high freight rates to return to normal, but it is not ruled out that emergencies disrupt the market structure and cause freight rates to plummet.
In addition, we should pay attention to the significant increase in cargo transportation costs due to supply chain blockage, such as empty container transportation, etc.; the sharp rise in fuel prices increases company costs; and the increase in compliance costs such as environmental protection conventions.
As of today's closing, China COSCO Shipping rose 4.11%, with a stock price of 14.68 yuan and a market value of 180 billion yuan. It is worth noting that since July 2, 2020, in just over nine months, the stock price of China COSCO Shipping has risen by more than 318%.
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