Analyst Predicts 50% Increase in COSCO’s Annual Profit

Analyst Predicts 50% Increase in COSCO’s Annual Profit

COSCO Group is anticipated to more than double its net profits this year due to a significant rise in shipping rates to Europe and the US, according to a leading Hong Kong analyst. Huatai Securities, previously known as Jiangsu Securities, reaffirmed its buy rating on COSCO’s stock and increased its target share price from HKD 11.50 to HKD 19.80. COSCO’s shares closed at USD 14.00 on Monday night, reflecting a 40% increase over the past two months.

Huatai projects that the group will generate RMB 58.6 billion in net profit for the full year 2024, up from RMB 28.4 billion in 2023. This prediction is based on a 50% year-on-year increase in average rates for both transpacific and Asia-Europe routes. The analyst does not foresee an end to Red Sea diversions soon and expects route adjustments to increase transshipment cargo volumes as port congestion continues to affect the market. The forecast includes both of COSCO Group’s liner brands, COSCO SHIPPING Lines and OOCL. Assuming a 50% dividend payout ratio by COSCO Group, investors could see a potential full-year dividend yield of 10%.