UBS Adjusting Estimates & PT on Eagle Bulk Shipping (EGLE); Risk/Reward Still Weighted Towards the Former

UBS maintains a 'Neutral' on Eagle Bulk Shipping (NASDAQ: EGLE) price target raised from $1.10 to $1.75.

UBS analyst said, "Dry bulk sector demand/supply fundamentals remain bad with supply expected to exceed demand again this year, in addition to the Eagle-specific risk of potential liquidity/default if Eagle is unable to restructure its loan agreements. Our advice remains that investors should stay on the sidelines."

"The high volatility and uncertainty with regard forecasting Eagle Bulk is rendering DCF less useful, and EGLE is technically worthless on a net asset value basis (i.e. net debt exceeds the fleet value). However, our raised 2013+ estimates require a higher target and at the historical “low quality” transport sector multiple of 6x EV/EBITDA we arrive at $1.75." (UBS cuts FY12 EPS loss from (0.09) to (0.42), but raises FY13 from $0.40 to $0.45)

For an analyst ratings summary and ratings history on Eagle Bulk Shipping click here. For more ratings news on Eagle Bulk Shipping click here.

Shares of Eagle Bulk Shipping closed at $1.74 yesterday.

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