NOL

NOL: Apr operating data. Volume +9% yoy, mainly driven by the Asia-Europe and Intra-Asia trade lanes. Macquarie however, highlights that rate recovery is behind schedule, with avg revenue per FEU -4% yoy to US$2549. Notes the usual trend is for rates to bottom in Feb and start moving higher until Jul-Aug...

Asia-Europe the main culprit, as rates have remained under pressure; this coincides with Maersk and MSC saying over the wkend that they are postponing a planned rate hike on Asia-Europe of US$500/FEU with other operators expected to follow suit...

Meanwhile, the long term competitive landscape is becoming increasingly challenging. NH Invmt warns that container lines plan to add a record amount of capacity in 2013, outpacing growth in demand for shipping services, which may drive maritime transport rates lower. This corroborates with Alphaliner data, which shows global container-shipping capacity rising by 11%, or a net 1.9m boxes in 2013, if all options and LOIs for new vessels are exercised, the fastest annual increase in 5 yrs...

Macquarie keeps NOL at Neutral with $2.25 TP, adds high bunker fuel price to provide additional headwinds.
Though Morgan Stanley, Credit Suisse remain bullish. MS keeps at Overweight, notes catalyst from improving 3Q freight rates, as seasonal demand pickup in 2H11 boosted by inventory restocking should prompt effective implementation of rate hikes and peak season surcharges. CS likes NOL for its high US contractual exposure.