Is Trending Stock ZIM Integrated Shipping Services Ltd. (ZIM) a Buy Now? – Yahoo Finance

ZIM Integrated Shipping Services (ZIM) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.
Shares of this container shipping company have returned +5% over the past month versus the Zacks S&P 500 composite’s +6.8% change. The Zacks Transportation – Shipping industry, to which ZIM belongs, has gained 5.4% over this period. Now the key question is: Where could the stock be headed in the near term?
Although media reports or rumors about a significant change in a company’s business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.
Earnings Estimate Revisions
Rather than focusing on anything else, we at Zacks prioritize evaluating the change in a company’s earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.
We essentially look at how sell-side analysts covering the stock are revising their earnings estimates to reflect the impact of the latest business trends. And if earnings estimates go up for a company, the fair value for its stock goes up. A higher fair value than the current market price drives investors’ interest in buying the stock, leading to its price moving higher. This is why empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For the current quarter, ZIM is expected to post earnings of $3.66 per share, indicating a change of -74.2% from the year-ago quarter. The Zacks Consensus Estimate remained unchanged over the last 30 days.
The consensus earnings estimate of $38.18 for the current fiscal year indicates a year-over-year change of -2.2%. This estimate has changed +0.5% over the last 30 days.
For the next fiscal year, the consensus earnings estimate of $4.07 indicates a change of -89.4% from what ZIM is expected to report a year ago. Over the past month, the estimate has changed -9.5%.
Having a strong externally audited track record, our proprietary stock rating tool, the Zacks Rank, offers a more conclusive picture of a stock’s price direction in the near term, since it effectively harnesses the power of earnings estimate revisions. Due to the size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, ZIM is rated Zacks Rank #5 (Strong Sell).
The chart below shows the evolution of the company’s forward 12-month consensus EPS estimate:
12 Month EPS
Projected Revenue Growth
While earnings growth is arguably the most superior indicator of a company’s financial health, nothing happens as such if a business isn’t able to grow its revenues. After all, it’s nearly impossible for a company to increase its earnings for an extended period without increasing its revenues. So, it’s important to know a company’s potential revenue growth.
In the case of ZIM, the consensus sales estimate of $2.22 billion for the current quarter points to a year-over-year change of -36%. The $12.62 billion and $7.17 billion estimates for the current and next fiscal years indicate changes of +17.7% and -43.2%, respectively.
Last Reported Results and Surprise History
ZIM reported revenues of $3.23 billion in the last reported quarter, representing a year-over-year change of +2.9%. EPS of $9.66 for the same period compares with $12.16 a year ago.
Compared to the Zacks Consensus Estimate of $3.01 billion, the reported revenues represent a surprise of +7.27%. The EPS surprise was +2.11%.
Over the last four quarters, ZIM surpassed consensus EPS estimates three times. The company topped consensus revenue estimates two times over this period.
Valuation
Without considering a stock’s valuation, no investment decision can be efficient. In predicting a stock’s future price performance, it’s crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company’s growth prospects.
Comparing the current value of a company’s valuation multiples, such as its price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), to its own historical values helps ascertain whether its stock is fairly valued, overvalued, or undervalued, whereas comparing the company relative to its peers on these parameters gives a good sense of how reasonable its stock price is.
The Zacks Value Style Score (part of the Zacks Style Scores system), which pays close attention to both traditional and unconventional valuation metrics to grade stocks from A to F (an An is better than a B; a B is better than a C; and so on), is pretty helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.
ZIM is graded A on this front, indicating that it is trading at a discount to its peers. Click here to see the values of some of the valuation metrics that have driven this grade.
Conclusion
The facts discussed here and much other information on Zacks.com might help determine whether or not it’s worthwhile paying attention to the market buzz about ZIM. However, its Zacks Rank #5 does suggest that it may underperform the broader market in the near term.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
ZIM Integrated Shipping Services Ltd. (ZIM) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research
Related Quotes
Trade Deficit Comes in Deeper Than Last Month.
All of the major indexes fell into bear market territory at various points this year with the Nasdaq Composite taking one of the bigger hits. Many Wall Street experts expect the bear market, or at the very least a correction, to stay with us well into 2023 as a recession looms. Analysts at Bank of America (NYSE: BAC) said the S&P 500 could fall to 3,240 by April, which would be a roughly 18% decline from current levels, before climbing back to around 4,000 by the end of the year — which is essentially where it is now.
Yahoo Finance Live anchor Seana Smith highlights Wednesday's biggest stock movers in after-hours trading.
Nio will need to show record monthly vehicle deliveries in December by a large margin to hit even the low end of its prior estimates.
Earlier this year, in May, claims were made that Microsoft Corp co-founder Bill Gates owned the majority of America’s farmland. While that is false, with the billionaire amassing nearly 270,000 acres of farmland across the country, compared to 900 million total farm acres, a different billionaire privately owns 2.2 million acres, making him the largest landowner in the U.S. John Malone, the former CEO of Tele-Communications Inc., which AT&T Inc. purchased for more than $50 billion in 1999, has a
This week has not been a fun time to own shares of Carnival (NYSE: CCL) (NYSE: CUK). Including today's 3.4% slide through 1 p.m. ET, Carnival stock has lost more than 10% of its value since the week began. On Tuesday, you see, investment banking heavyweight J.P. Morgan waded back into the cruise space with a trio of stock initiations.
Worried about the prospect of a recession coming next year? Well, that sounds like a mild scenario, if Michael Burry’s prognosis is anything to go by. The investor whose famous bet against the US housing market was documented in “The Big Short,” thinks a ‘multi-year recession’ is potentially in the cards – and one more severe than currently expected. This statement follows previous warnings regarding the economy, such as predicting last year that the ‘mother of all crashes’ is coming, while also
Reconnaissance Energy Africa Ltd. (the "Company" or "ReconAfrica") (TSXV: RECO) (OTCQX: RECAF) (Frankfurt: 0XD) announces a conference call for investors and analysts will be held on Thursday, December 8, 2022 at 11:00 am Eastern Time. Participants will include Scot Evans, Chief Executive Officer, Dr. James Granath, Chief Geoscientist, and Grayson Andersen, Head of Capital Markets.
On a bad day for most stocks, shares of electric-vehicle-related ChargePoint Holdings (NYSE: CHPT) and QuantumScape (NYSE: QS), and hydrogen fuel cell maker Plug Power (NASDAQ: PLUG) are down between 6% and 8%. There isn't any big news out from — or about — any of these three companies today that is the specific cause for any of their share-price declines. The most recent news is from ChargePoint, the EV charging station company, which reported third-quarter results on Dec. 1, with a 93% increase in revenue, but continues to report big losses.
Smith & Wesson Brands (NASDAQ: SWBI) reported financial results that missed the target by a wide margin. After markets closed Tuesday, Smith & Wesson reported earnings of $0.26 per share on revenue of $121 million for its fiscal second quarter, which ended Oct. 31. The company blamed the macro environment for the miss, along with a difficult competitive environment.
Carvana shares spiraled Wednesday after the online car retailer’s biggest creditors reportedly signed an agreement to cooperate in potential restructuring negotiations as the company faces growing bankruptcy risk.
Will there be a new beginning?
Marc Benioff became frustrated about how his co-CEO Bret Taylor, who is set to exit the role, was spending his time, people familiar with the executives said.
Shares of MongoDB (NASDAQ: MDB) were flying higher today after the database software company posted strong results in its third-quarter earnings report. MongoDB, which specializes in NoSQL database software, trounced estimates in its latest update and even reported a surprise profit. Its cloud-based product, Atlas, again led the way with 61% growth and now makes up 63% of total revenue.
In this article, we discuss the 13 best gold stocks to buy for recession. If you want to read about some more gold stocks, go directly to 5 Best Gold Stocks To Buy For Recession. According to a report by S&P Global, the sentiments for gold investment have risen over the past few months due […]
Whether Santa eventually comes or not is still to be determined, with Mr. Claus perhaps postponing a decision until next Tuesday’s CPI release. Strategists led by Greg Boutle, head of U.S. equity and derivatives strategy, are expecting a capitulation event next year. “This would be a departure from the current bear market regime, which has been characterized by a grind lower in equities as P/E multiples have contracted,” they say.
Yahoo Finance's Jared Blikre breaks down GameStop's third-quarter earnings results. 
Shares of Lovesac (NASDAQ: LOVE) were down 16% as of 11:40 a.m. ET on Wednesday after the company delivered better-than-expected earnings results for the fiscal third quarter ending Oct. 30. It was a strong quarter in the context of the economic environment. Lovesac clearly has a superior brand positioning and is taking significant market share.
VinFast says its vehicles are 'differentiated, especially across the emerging EV space.' Here's what the company is touting.
Shares of many of America's largest banks are tumbling again on Tuesday after a period of outperformance that saw Goldman Sachs Group GS claw back practically all of its losses year-to-date.

source

Leave a Comment