Equity Research: Hapag-Lloyd, AG

The Equity Research report of Hapag-Lloyd, AG was written based on the research report format of ISEG’s Master Final Work also recommended by the CFA Institute, divided into the following 8 parts: Research Snapshot, Business Description, Management and Corporate Governance which also includes Environmental, Social and Governance, Industry Analysis, Investment Summary, Valuation, Financial Analysis, Investment Risks. Hapag-Lloyd is the 5th largest container liner shipping company that operates worldwide with 421 sales offices in 137 counties. The core business of Hapag-Lloyd is container liner shipping, but also includes transport services from door to door. Its leading market position is evidenced by its transport capacity of 1.8m TEU and revenue of €22.3bn in FY2021, a sharp increase of 74% compared to FY2020. With the closing price at €177.6 per share on 30th December 2022 and a calculated price target of €207.84 for 2023YE, Hapag-Lloyd's recommendation is "Hold" given its high exposure to economic cycles and the high-risk profile indicated by its "single" business segment. The price target is estimated based on the DCF model as the primary methodology, supported by other absolute and relative methods, representing an upside potential of 17.03%. Hapag-Lloyd expects to deliver solid financial performance in 2022, because of ultra-high freight rates resulting from supply chain disruptions and high demand for goods.