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Smooth sailing for shipping giant Clarkson with solid interim results
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Smooth sailing for shipping giant Clarkson with solid interim results

Story Highlights

Shipping giant Clarkson finished its first six months of 2022 with a whopping 53% increase in profits.

Shipping service provider Clarkson (GB:CKN) posted its interim results for the period that ended on June 30, 2022 – and the firm is riding high as the war in Ukraine saw freight rates soar to new highs.

The company’s revenue increased by 40% to £266 million, mainly pushed by its broking division. The broking business, which contributes almost 80% of the revenues, grew by 48% to £211 million.

The stock has been shaky with just a 3.28% return in the last year – but it has grown by 68% in the last three years.

What does Clarkson do?

Clarkson operates a complete package of shipping services, including broking, research, finance, advisory, and more.

The shipping industry faces challenges, mainly due to the Russia-Ukraine war, which has disturbed the sea trade. However, increased traffic at ports and reduced supply led to stronger business for Clarkson internationally.

Amid all these challenges, Clarkson’s outlook remains fairly positive. The company says the second half of the year is already on a growth trajectory with similar trends.

Andi Case, the chief executive, said that the business would continue to benefit from its “international footprint, leading market position, diverse offering, and a deep understanding of the energy transition.”

The company’s positive results have allowed the management to continue its tradition of increasing its dividends every year. It has increased its interim dividend by 2p to 29p per share, marking the company’s entry into the 20th consecutive year of growing shareholders returns.

View from the City

According to TipRanks’ analyst rating consensus, Clarkson’s stock is a Moderate Buy. It has a Buy rating from HSBC and a Hold rating from J.P. Morgan.

It has an average price target of 3,837.18p, which represents a 5.7% change in the price from the current level. The price has a high and a low forecast of 3,900p and 3,775p, respectively.

Conclusion

Investors should look at Clarksons’ growth-oriented performance, positive outlook, and dividend.

Disclosure

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