BWLP: 3 Shipping Stocks Optimizing the Logistics Ecosystem

The shipping industry plays a pivotal role in global trade, and as supply chains evolve, shipping companies are optimizing their logistics operations to meet rising demand efficiently. Advanced technologies, including AI-driven route optimization and automated port operations, are becoming integral to enhancing delivery speed and reducing costs.

Given the industry’s robust prospects, it could be wise to invest in fundamentally sound shipping stocks Star Bulk Carriers Corp. (SBLK), Teekay Corporation Ltd. (TK), and BW LPG Limited (BWLP), for potential gains.

The shift toward green logistics is another trend reshaping the industry. Green logistics refers to the integration of environmentally sustainable practices within supply chains and transportation systems that involve reducing carbon footprints and optimizing resource efficiency.

Shipping companies are adopting cleaner fuels, such as LNG, and exploring electric and hybrid ships to reduce their carbon footprint. These initiatives align with stricter environmental regulations and growing consumer demand for sustainable practices.

Furthermore, e-commerce growth has further amplified the need for robust logistics networks. Companies that specialize in last-mile delivery and global freight forwarding are seeing increased demand as businesses strive to meet customer expectations for fast and reliable shipping.

As global trade rebounds, shipping stocks are well-positioned to benefit from increased activity. Moreover, the global cargo shipping market is projected to reach $4.2 trillion by 2031, exhibiting a CAGR of 7%.

Considering the positive trajectory of developments, let’s delve deeper into Shipping stocks:

Stock #3: Star Bulk Carriers Corp. (SBLK)

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Headquartered in Marousi, Greece, SBLK is a global shipping company that owns and operates a diverse fleet of dry bulk vessels that transport bulk commodities, including iron ore, minerals and grain, bauxite, fertilizers, and steel products, along worldwide shipping routes.

In the fiscal third quarter that ended on September 30, 2024, SBLK’s total revenues increased 54.3% year-over-year, amounting to $263.77 million. The company reported operating income of $95.16 million, indicating a 58.5% growth from the prior-year quarter.

Its adjusted net income came in at $82.70 million, up 149.5% year-over-year, while its adjusted earnings per share grew by 108.8% from the prior-year quarter to $0.71. Also, SBLK’s adjusted EBITDA rose 71.5% from the year-ago value of $144.36 million.

Analysts expect SBLK’s revenue for the fiscal year (ended December 2024) to increase 42.8% year-over-year to $993.15 million, while its EPS for the same quarter is expected to grow 48.5% from the prior year to $2.73. For the fiscal year 2025, its revenue is expected to be $1 billion, indicating a marginal improvement over the prior year.

Moreover, SBLK’s revenue has grown at CAGRs of 3.1% and 9.3% over the past three and five years, respectively. In addition, its normalized net income increased at 75.9% CAGR over the past five years.

Shares of SBLK have declined by 2.1% over the past month to close the last trading session at $14.68.

SBLK’s POWR Ratings reflect this robust outlook. The stock has an overall rating of B, which equates to Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.

SBLK has a B grade for Value and Quality. It is ranked #13 out of 35 stocks in the A-rated Shipping industry. Click here to see the additional ratings for SBLK (Growth, Momentum, Stability, and Sentiment).

Stocks #2: Teekay Corporation Ltd. (TK)

Based in Hamilton, Bermuda, TK engages in crude oil and other marine transportation services worldwide. The company owns and operates crude oil and refined product tankers. It also offers ship-to-ship support services, tanker commercial management operation services, and operational and maintenance marine services.

For the third quarter of 2024, which ended on September 30, TK’s revenues were reported to be $272.62 million, while the income from vessel operations stood at $52.19 million. Its adjusted net income attributable was valued at $21.10 million and $0.23 per share.

TK’s normalized net income has grown at a CAGR of 192.5% over the past three years. Likewise, the company’s diluted EPS has increased at a CAGR of 198.7% over the past three years.

TK’s shares have surged 10.6% over the past month to close the last trading session at $7.04.

TK’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.

It also has a B grade for Value and Quality. Within the Shipping industry, it is ranked #11. Click here to see TK’s ratings for Growth, Momentum, Stability, and Sentiment.

Stock #1: BW LPG Limited (BWLP)

Based in Singapore, BWLP is an investment holding that engages in international ship-owning and chartering activities. The company operates through two segments: Shipping and Product Services.

During the fiscal third quarter that ended on September 30, 2024, BWLP’s revenue of Product Services increased 44.4% year-over-year, amounting to $584.60 million. Its operating profit amounted to $139.17 million, increasing 8.6% year-over-year. In addition, the company’s profit attributable amounted to $120.46 million, while its EPS stood at $0.79.

Street expects BWLP’s revenue for the fiscal year (ending January 2025) to be $778 million. Its revenue for the fiscal year 2025 is expected to register a 2.9% growth from the prior year, settling at $801.21 million.

Over the past three and five years, BWLP’s revenue grew at CAGRs of 73.1% and 38.3%, respectively, while its levered FCF grew at 77.7% CAGR over the past three years.

The stock has gained 16.5% over the past month to close the last trading session at $11.96.

It’s no surprise that BWLP has an overall rating of B, equating to a Buy in our POWR Ratings system. It has an A grade for Quality and a B for Value. Out of 35 stocks in the same A-rated industry, BWLP is ranked #2.

Beyond what is stated above, we’ve also rated BWLP for Growth, Momentum, Stability, and Sentiment. Get all BWLP’s ratings here.

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BWLP shares were trading at $11.95 per share on Wednesday afternoon, down $0.01 (-0.08%). Year-to-date, BWLP has gained 5.19%, versus a 3.56% rise in the benchmark S&P 500 index during the same period.