Shipping Industry Set for Continued Growth in 2024, Dorian LPG, EuroDry, and Kirby Corporation Among Top Stocks to Watch
The Zacks Transportation – Shipping industry has shown resilience in the face of challenges like inflation, high interest rates, and supply chain disruptions. These headwinds, the industry saw a 16% gain in 2023, driven by increased demand for liquefied petroleum gas and the re-opening of the Chinese economy.
One of the primary factors driving the growth of the shipping industry is the increased demand for liquefied petroleum gas, particularly propane, from the United States. This has been a huge positive for companies like Dorian LPG, which operates a fleet of VLGCs for transporting these gases on long-haul voyages. The availability of propane for export has also been on the rise, further boosting the industry. Additionally, the capacity restrictions at the Panama Canal have resulted in increased spot rates, which are expected to remain high in the near future.
The re-opening of the Chinese economy has also been a significant boost for the shipping industry. China is not only a key manufacturing hub, but also a major consumer of goods and services. This makes the country a crucial market for ocean shipping. With the Chinese economy back in action, the entire shipping industry is expected to see positive growth.
Considering these factors, investing in shipping stocks like Dorian LPG, EuroDry, and Kirby Corporation is a prudent idea. These companies currently hold a Zacks Rank #1 (Strong Buy) or 2 (Buy) and have seen favorable earnings estimate revisions for 2024. In 2023, all three stocks saw double-digit gains, with Dorian LPG leading the pack with a 131.5% surge. The Zacks Consensus Estimate for Dorian’s 2024 earnings has also seen a significant increase of 136.5% over the past 60 days.
EuroDry, which owns and operates drybulk vessels, has also seen a positive trend in charter rates for sub-Capesize vessels. The company’s efforts to expand its fleet have also been commendable. Its stock saw a gain of over 10% in 2023, and the Zacks Consensus Estimate for its 2024 earnings has increased by 33.3% over the past 60 days.
The shipping industry is poised for continued growth in 2024, making stocks like Dorian LPG, EuroDry, and Kirby Corporation attractive options.
