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Danaos Corp (DAC)
NYSE:DAC
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Danaos
(NYSE:DAC)
74Outperform
Danaos (DAC) vs. S&P 500 (SPY)
Market Cap
$1.50B
Dividend Yield4.13%
Average Volume (3M)104.01K
Price to Earnings (P/E)3.1
Beta (1Y)0.45
Revenue Growth6.00%
EPS Growth-9.89%
CountryUS
Employees4
SectorIndustrials
Sector Strength72
IndustryTransportation
Share Statistics
EPS (TTM)25.92
Shares Outstanding18,669,310
10 Day Avg. Volume89,142
30 Day Avg. Volume104,008
Financial Highlights & Ratios
PEG Ratio2.40
Price to Book (P/B)N/A
Price to Sales (P/S)1.53
Price to Cash Flow (P/CF)N/A
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
Danaos Business Overview & Revenue Model
Company DescriptionDanaos Corporation (DAC) is a leading international owner of containerships, primarily engaged in the seaborne transportation of containerized cargo. The company operates a fleet of modern, large-size containerships that serve international shipping lines. Headquartered in Greece, Danaos is a major player in the global shipping industry, providing transportation services across worldwide routes, supporting the movement of goods in a highly interconnected global market.
How the Company Makes MoneyDanaos Corporation generates revenue primarily through the leasing of its containership fleet to major shipping lines under long-term, fixed-rate time charter agreements. These agreements provide the company with a predictable and stable cash flow. The key revenue streams include charter hire fees paid by shipping companies for the use of Danaos' vessels. Additionally, the company benefits from strategic partnerships with some of the largest container shipping operators in the world, enhancing its market position and ensuring high vessel utilization rates. Danaos' earnings are also influenced by factors such as global trade volumes, shipping demand, and market charter rates.
Danaos Financial Statement Overview
Summary
Danaos shows strong financial health with impressive profitability metrics and a stable balance sheet. While revenue growth and healthy margins are evident, the decline in net income and negative free cash flow highlight areas needing attention. The increase in total debt poses moderate leverage risks.Income Statement
Danaos has demonstrated solid financial performance with a strong gross profit margin of 60.7% and a net profit margin of 49.8% for 2024. The revenue growth from 2023 to 2024 was 4.2%, showing a positive trajectory. EBIT and EBITDA margins are robust at 53.3% and 66.6%, respectively, indicating efficient operational management. However, a decrease in net income from 2023 to 2024 suggests potential challenges in profitability.82
Very Positive
Balance Sheet
The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.21 and a strong equity ratio of 78.9%, showcasing significant financial stability. Return on equity stands at 14.7%, reflecting good returns on shareholders' equity. The increase in stockholders' equity over the years highlights strengthening financial health. However, the rise in total debt from 2023 to 2024 may pose moderate leverage risks if not managed carefully.78
Positive
Cash Flow
Operating cash flow covers net income comfortably with a ratio of 1.23, indicating solid cash generation capability. However, the substantial decline in free cash flow year-over-year, resulting in negative free cash flow for 2024, is concerning and suggests potential liquidity constraints. The company's ability to revert to positive free cash flow is critical for future financial flexibility.68
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.01B | 973.58M | 993.34M | 689.50M | 461.59M | Gross Profit |
| 615.94M | 643.71M | 664.96M | 412.39M | 234.85M | EBIT |
| 540.88M | 580.66M | 653.44M | 358.26M | 199.48M | EBITDA |
| 675.07M | 704.83M | 787.63M | 444.48M | 315.64M | Net Income Common Stockholders |
| 505.07M | 576.30M | 559.21M | 1.05B | 93.15M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 514.23M | 357.84M | 267.67M | 552.43M | 65.66M | Total Assets |
| 4.34B | 3.66B | 3.40B | 3.63B | 2.71B | Total Debt |
| 734.78M | 404.17M | 501.95M | 1.34B | 1.46B | Net Debt |
| 281.40M | 132.37M | 234.28M | 1.21B | 1.40B | Total Liabilities |
| 918.85M | 644.82M | 839.81M | 1.54B | 1.68B | Stockholders Equity |
| 3.42B | 3.02B | 2.56B | 2.09B | 1.04B |
| Cash Flow | Free Cash Flow | |||
| -37.59M | 308.26M | 735.61M | 72.39M | 95.02M | Operating Cash Flow |
| 621.75M | 576.29M | 934.74M | 428.11M | 265.68M | Investing Cash Flow |
| -650.79M | -338.53M | 176.57M | -143.15M | -170.74M | Financing Cash Flow |
| 210.61M | -233.62M | -973.40M | -220.87M | -168.45M |
Danaos Technical Analysis
Positive
80.37
Price Trends
79.48
Positive
79.98
Positive
81.91
Negative
Market Momentum
-0.09
Positive
51.15
Neutral
71.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DAC, the sentiment is Positive. The current price of 80.37 is below the 20-day moving average (MA) of 81.18, above the 50-day MA of 79.48, and below the 200-day MA of 81.91, indicating a neutral trend. The MACD of -0.09 indicates Positive momentum. The RSI at 51.15 is Neutral, neither overbought nor oversold. The STOCH value of 71.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DAC.
Danaos Risk Analysis
Danaos disclosed 63 risk factors in its most recent earnings report. Danaos reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Danaos Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
85 Outperform | $803.58M | 2.40 | 26.71% | 7.57% | 7.05% | 6.23% | |
81 Outperform | $230.67M | 2.06 | 35.83% | 7.17% | 13.90% | 3.21% | |
77 Outperform | $1.87B | 5.74 | 14.71% | 15.87% | 33.31% | 62.94% | |
74 Outperform | $2.48B | 1.74 | 44.28% | 19.13% | 21.47% | ― | |
74 Outperform | $1.50B | 3.07 | 15.68% | 4.13% | 6.00% | -9.89% | |
64 Neutral | $1.22B | 4.25 | 13.07% | 4.44% | 37.10% | -17.36% | |
62 Neutral | $8.16B | 12.85 | 0.64% | 3.04% | 3.83% | -15.83% |
* Industrials Sector Average
Performance Comparison
DAC
Danaos
80.37
11.31
16.38%
CMRE
Costamare
10.16
-0.94
-8.47%
ESEA
Euroseas
32.49
-2.31
-6.64%
GSL
Global Ship Lease
23.38
4.64
24.76%
SBLK
Star Bulk Carriers
15.79
-6.45
-29.00%
ZIM
ZIM Integrated Shipping Services
20.31
11.15
121.72%
Danaos Earnings Call Summary
Earnings Call Date: Feb 10, 2025 | % Change Since: 0.29% | Next Earnings Date: May 19, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture. While Danaos Corporation demonstrated strong financial resilience with a solid contracted revenue backlog, high charter coverage, and a robust share repurchase program, it also faced challenges such as decreased adjusted net income and increased operating and finance costs. The dry bulk market's softness and weakening box rates add to the concerns, balancing out the otherwise positive highlights.Highlights
Strong Contracted Revenue Backlog
The contracted revenue backlog increased to $3.4 billion with a 3.7-year average charter duration, providing significant income certainty and market insulation for Danaos Corporation.
High Charter Coverage
Danaos Corporation has secured 97% coverage for 2025 and 79% for 2026 at healthy rates, reducing exposure to market volatility.
Increase in Adjusted EBITDA
Adjusted EBITDA increased by 9.9% or $17.1 million to $189.7 million in Q4 2024 compared to $172.6 million in Q4 2023, driven by improvements in operating revenues and investment income.
Share Repurchase Program
Danaos Corporation has repurchased an additional $45.6 million in shares since the last earnings release, with a total of $168.8 million out of the $200 million authority executed.
Strong Liquidity Position
Total liquidity, including availability under revolving credit facility and marketable securities, stood at $807 million, providing flexibility for capital deployment.
Lowlights
Decrease in Adjusted Net Income
Adjusted net income decreased by $2.7 million from $136 million in Q4 2023 to $133.3 million in Q4 2024, primarily due to increased OpEx and finance costs.
Increase in Operating and Finance Costs
Total operating expenses increased by $11 million, and interest expenses increased by $6 million due to higher average indebtedness and lower capitalized interest.
Soft Dry Bulk Market
The dry bulk market, particularly in the Panamax and smaller segments, continues to face challenges due to the slow recovery of the Chinese economy and delivery of new tonnage.
Box Rates Weakening
While container charter market remains healthy, box rates are weakening, though still higher than pre-pandemic levels.
Company Guidance
During the Danaos Corporation call discussing the financial results for the fourth quarter of 2024, the company emphasized its strong financial position and strategic initiatives. The firm reported an adjusted EPS of $6.93 per share, with an adjusted income of $133.3 million, despite a slight decrease from the previous year's $136 million. Danaos highlighted a robust charter backlog of $3.4 billion, providing significant revenue certainty with 97% coverage for 2025 and 79% for 2026. The company's adjusted EBITDA increased by 9.9% to $189.7 million, demonstrating consistent profitability. Danaos also secured an $850 million loan facility to support its new building program, maintaining a low net debt to adjusted EBITDA ratio of 0.4 times. The company continued to execute share repurchases, with a total of $168.8 million out of the authorized $200 million already repurchased, and maintained liquidity of $807 million, positioning them well for future opportunities.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.