Jefferies Cuts Price Target on CAI International (CAP), Utilization Remained Stable
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Rating Summary:
4 Buy, 4 Hold, 0 Sell
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Today's Overall Ratings:
Up: 13 | Down: 22 | New: 8
Rating Summary:
4 Buy, 4 Hold, 0 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 13 | Down: 22 | New: 8
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Jefferies is maintaining its Buy rating on shares of CAI International (NYSE: CAP), but is cutting its price target from $30 to $24.
The company reported solid Q2 results with EPS of $0.55 and revenue of $31.5, which both topped the Street's and firm's estimates. The firm is forecasting that revenues will increase by just shy of $5 million by the end of the year due to lease-outs from the first half beginning to fully impact returns.
Utilization for the quarter was stable at 98 percent and with 87% of the total fleet committed to long-term leases. The firm forecasts that utilization will remain above long-term averages over the next few quarters.
An analyst at Jefferies comments, "Despite the uncertainties surrounding the container shipping industry, we belive CAP is in a good competitive position. All of the Company's early 2011 purchases have been placed. We believe larger, more aggressive players have yet to fully deploy early 2011 purchases. As such, CAP can offer lease rates up to 12% lower than competitors who have equipment that was purchased in a higher cost environment."
The firm cut its third quarter 2011 and full year 2011 EPS estimates from $0.64 and $2.47 to $0.55 and $2.37. Jefferies also lowered its full year 2011 estimate substantially from $2.72 to $2.39.
For more ratings news on CAI International click here and for the rating history of CAI International click here.
Shares of CAI International closed at $16.68 yesterday.
The company reported solid Q2 results with EPS of $0.55 and revenue of $31.5, which both topped the Street's and firm's estimates. The firm is forecasting that revenues will increase by just shy of $5 million by the end of the year due to lease-outs from the first half beginning to fully impact returns.
Utilization for the quarter was stable at 98 percent and with 87% of the total fleet committed to long-term leases. The firm forecasts that utilization will remain above long-term averages over the next few quarters.
An analyst at Jefferies comments, "Despite the uncertainties surrounding the container shipping industry, we belive CAP is in a good competitive position. All of the Company's early 2011 purchases have been placed. We believe larger, more aggressive players have yet to fully deploy early 2011 purchases. As such, CAP can offer lease rates up to 12% lower than competitors who have equipment that was purchased in a higher cost environment."
The firm cut its third quarter 2011 and full year 2011 EPS estimates from $0.64 and $2.47 to $0.55 and $2.37. Jefferies also lowered its full year 2011 estimate substantially from $2.72 to $2.39.
For more ratings news on CAI International click here and for the rating history of CAI International click here.
Shares of CAI International closed at $16.68 yesterday.
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