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Hawk’s Nest

Unusual Call Buying in Containership Play Costamare (CMRE)

by | Jul 13, 2021

Costamare (CMRE) unusual activity this week with 1400 September $12 calls bought on 7/12 near $0.80 and then another 3500 traded on 7/13 as IV continues to rise. CMRE shares are in a strong trend and are +38.5% YTD recently pulling back and holding the rising 55-day moving average as support. CMRE is based in Monaco and is an international owner of containerships, chartering its vessels to many of the world’s largest liner companies. CMRE has a fleet of 77 containerships with a total capacity of approximately 555,810 TEU, making it one of the largest public containership companies in the world based on total TEU capacity. CMRE’s five largest customers account for over 90% of revenues and include A.P. Moller-Maersk, MSC, Evergreen, Hapag Lloyd and COSCO. We have seen a lot of recent positive commentary and reports regarding shipping rates and container demand and charter rates are what drives revenues at CMRE. CMRE has total of 23 ships coming off charter over the next 18 months, which is a favorable position, should the current market conditions continue. CMRE has a market cap of $1.36B and trades 6.7X EBITDA with a 3.5% dividend yield. EBITDA is forecasted to rise 44% in 2021. In June, CMRE acquired 16 dry bulk vessels that diversifies it away from containerships. CMRE commenting in early June on its earnings call noted “Strong demand for goods, restocking of inventories and a balanced container vessel market have all helped the charter market reach levels that we have not seen for a decade.”