Euroseas (ESEA) AI Stock Analysis

• Market Cap: $273.02M
• Dividend Yield: 6.32%
• Average Volume (3M): 28.13K
• Price to Earnings (P/E): 2.4
• Beta (1Y): 0.94
• Revenue Growth: 12.43%
• EPS Growth: -1.63%
• Country: US
• Employees: 365
• Sector: Industrials
• Sector Strength: 89
• Industry: Marine Shipping
• EPS (TTM): 2.84
• Shares Outstanding: 7,047,537
• 10 Day Avg. Volume: 26,541
• 30 Day Avg. Volume: 28,130
• PEG Ratio: -3.45
• Price to Book (P/B): 0.59
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -4.27
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $53.67
• Price Target Upside: 42.70% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

Euroseas is in a strong financial position with substantial revenue and profit growth and prudent financial management. The stock is technically strong but could experience short-term volatility due to overbought conditions. Valuation metrics are attractive, with a low P/E ratio and high dividend yield. The recent earnings call supports the positive outlook, though investors should monitor potential risks such as declining charter rates and geopolitical uncertainties.

Positive Factors

Contracts

A new time charter equivalent contract for a containership was announced at a rate higher than previously estimated.

Dividends

The quarterly dividend of $0.65, raised from $0.60, represents an attractive annualized yield of 8.2%.

Earnings

Euroseas Ltd reported 3Q24 results with revenue and EPS exceeding expectations.

Negative Factors

Interest Expense

3Q24 EPS declined year over year due to an 83.3% increase in interest expense.

Spin-off Impact

Revenue and EPS estimates are reduced due to the spin-off of Euroholdings.

Euroseas Business Overview & Revenue Model

Company Description

Euroseas Ltd. provides ocean-going transportation services worldwide. The company owns and operates containerships that transport dry and refrigerated containerized cargoes, including manufactured products and perishables. As of May 03, 2022, it had a fleet of 18 vessels, including 10 feeder and 8 intermediate containerships with a cargo capacity of approximately 58,871 twenty-foot equivalent unit (teu). The company was incorporated in 2005 and is based in Marousi, Greece.

How the Company Makes Money

Euroseas makes money through the operation of its fleet of container ships and dry bulk vessels, which are chartered out to customers on short-term or long-term contracts. The company earns revenue from these charters based on the duration and terms agreed upon with its clients, which include shipping companies and other entities requiring maritime transport services. Key revenue streams include time charter contracts, where vessels are hired out for specific time periods, and voyage charters, where ships are hired to transport specific cargo on particular routes. The company's earnings are influenced by factors such as shipping rates, fleet utilization, and operational efficiency. Euroseas also benefits from strategic partnerships with other shipping companies and alliances that enable it to optimize its fleet deployment and expand its market reach.

Euroseas Financial Statement Overview

Summary

Euroseas has shown strong financial performance with significant revenue and profit growth. The income statement is robust with high profit margins, and the balance sheet reflects stable equity and manageable debt levels. However, negative free cash flow due to capital expenditures is a concern that needs attention.

Income Statement

Euroseas has demonstrated strong revenue growth over the years, with a significant increase from $53.3 million in 2020 to $212.9 million in 2024. The gross profit margin is healthy at approximately 72.2% for 2024, and the net profit margin is robust at about 53.0%. The company has shown consistent EBIT and EBITDA margins, indicating efficient operational management. Overall, the income statement reflects a strong financial performance with significant growth in key profitability metrics.

Balance Sheet

The balance sheet shows a stable equity base, with stockholders' equity rising from $35.4 million in 2020 to $362.9 million in 2024. The debt-to-equity ratio is modest at approximately 0.57 in 2024, indicating effective leverage management. The equity ratio has improved, reflecting strengthened financial stability. However, the increase in total debt over the years suggests a need for careful debt management in the future.

Cash Flow

Euroseas' operating cash flow has been consistently positive, reaching $128.2 million in 2024, though there was a notable drop in free cash flow due to capital expenditures. The free cash flow to net income ratio has been negative recently, highlighting potential cash flow management issues. Despite this, the company maintains a strong operational cash flow to net income ratio, indicating efficient cash generation from operations.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
212.90M	189.36M	182.69M	93.89M	53.30M
	Gross Profit
153.70M	119.86M	114.52M	52.14M	12.61M
	EBIT
120.02M	119.43M	106.64M	45.65M	6.98M
	EBITDA
135.74M	143.82M	129.84M	52.95M	14.77M
	Net Income Common Stockholders
112.78M	114.55M	106.24M	42.96M	-83.72K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
73.74M	58.61M	25.85M	26.53M	3.56M
	Total Assets
591.22M	424.67M	328.59M	221.51M	110.58M
	Total Debt
205.40M	130.00M	107.23M	118.04M	69.37M
	Net Debt
131.66M	71.39M	81.39M	91.51M	65.81M
	Total Liabilities
228.27M	158.10M	160.44M	144.74M	75.23M
	Stockholders Equity
362.95M	266.58M	168.16M	76.77M	35.36M
Cash Flow		Free Cash Flow
-50.75M	17.71M	23.39M	-21.49M	1.76M
	Operating Cash Flow
128.17M	130.01M	114.08M	52.63M	2.43M
	Investing Cash Flow
-168.77M	-102.19M	-87.13M	-74.11M	16.30M
	Financing Cash Flow
56.96M	5.06M	-27.01M	46.65M	-18.32M

Euroseas Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 37.61
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ESEA, the sentiment is Positive. The current price of 37.61 is above the 20-day moving average (MA) of 32.73, above the 50-day MA of 30.48, and above the 200-day MA of 30.88, indicating a bullish trend. The MACD of 2.16 indicates Negative momentum. The RSI at 73.46 is Negative, neither overbought nor oversold. The STOCH value of 91.87 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ESEA.

Euroseas Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ESEA	82 Outperform	$273.02M	2.39	35.83%	6.32%	12.43%	-1.63%
GASS	77 Outperform	$203.01M	2.73	11.88%	―	16.54%	42.56%
SB	68 Neutral	$380.02M	4.35	11.99%	5.54%	8.17%	35.92%
Sector *	64 Neutral	$4.40B	12.09	5.26%	250.03%	4.08%	-11.05%
CTRM	63 Neutral	$23.58M	0.73	3.07%	―	-45.58%	45.06%
DSX	55 Neutral	$178.29M	26.19	2.56%	11.18%	-12.93%	-86.34%
GLBS	47 Neutral	$22.95M	52.39	0.24%	―	11.74%	-91.84%