AP Moller Maersk downgraded to Underperform from Peer Perform at Wolfe Research

Wolfe Research analyst Jacob Lacks downgraded AP Moller Maersk to Underperform from Peer Perform with an DKK 8,800 price target West Coast import volumes surged in Q3, leading to the best growth in rail intermodal volumes in the past 13 quarters, but truckload spot rates and less-than-truckload tonnage for most carriers remained muted, and Wolfe continues to see a “mixed bag” across freight with no signs of a broad recovery, the analyst tells investors in a research note. The firm is looking to reduce exposure to falling ocean rates and as Maersk is already down 17% year-to-date, Wolfe sees potential for significant earnings risk and cash burn ahead based on the expectation that ocean rates will continue to normalize lower over the next 1-2 years.