Genco Shipping (GNK) PT Lowered to $20 at Maxim Group; Remains Top Pick

Maxim Group analyst James Jang lowered the price target on Genco Shipping (NYSE: GNK) to $20.00 (from $22.00) while maintaining a Buy rating.

• GNK reported 4Q18 results with revenue, EBITDA, and EPS all above our expectations as the company's fleet achieved higher TCE rates than our forecast.

• We are lowering our price target to $20, from $22, and reducing estimates to account for the planned sale of seven Supramax vessels in 2019. However, we expect GNK to outperform the peer group through our forecast period as the high-quality fleet and active commercial management should allow for expanded earnings (GNK outperformed the Baltic Exchange indices by about $500 per vessel/day during 4Q18).

• In-house management helped lower vessel opex to $4,379 per vessel/day, (Maxim estimate $4,485 per vessel/day) and continues the corporate strategy of streamlining operations.

• GNK is our top pick; our new price target of $20 is based on our 2020 NAV estimate of $19.04 ($22.18 prior).

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