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CTRM Stock: Why Is Castor Maritime Rallying 15% Today?


Today’s been a rather volatile day in the markets. Most indices have started off the day very green, then dipped into the red before recovering in afternoon trading. However, Castor Maritime (NASDAQ:CTRM) is one stock that’s maintained a very strong performance from this morning. Currently, CTRM stock is up more than 17% on very high volume, making it one of today’s biggest winners.

A magnifying glass zooms in on the website for Castor Maritime (CTRM).

Source: Pavel Kapysh / Shutterstock.com

Now, zooming out on Castor Maritime’s stock chart, this is a company that’s been in a serious decline in recent months. The company’s six-month chart details a company that’s been under serious pressure. A global shipping company, Castor Maritime has benefited from leveraged exposure to sea freight, particularly during the last boom in freight prices.

Supply chain bottlenecks remain, and shipping costs remain elevated. However, investors appear to have come to grips with Castor Maritime’s balance sheet and use of leverage to obtain its growth. Right now, balance sheet quality matters, as investors continue to rotate into more defensive stocks. The company’s high-growth upside has thus been overshadowed by more bearish market sentiment that has materialized recently.

That said, CTRM stock received a nice jolt today because of its earnings. Let’s dive into what the company reported and why investors are so giddy.

CTRM Stock Soars on Impressive Earnings

Earnings reports typically provide for impressive periods of near-term volatility. Earnings beats can send a stock skyrocketing, while poor guidance or an earnings miss can have the opposite effect.

Today, investors in CTRM stock fortunately have the former situation. Indeed, the company reported an impressive $29.2 million in net income for the past quarter, more than doubling its year-to-date earnings over the previous nine months. Overall, 2021 saw the company bring in $52.3 million in net income. As a company that’s valued at $133 million (after today’s rise), that’s a price-earnings multiple of only 2.6.

For value investors, there’s a real argument to take a look at this stock.

For growth investors, there’s also a lot to like about this report. The company noted revenue of $60 million for this past quarter. That’s compared to a measly $4.4 million for the same quarter a year prior. That kind of growth, and this rather impressive set of earnings, provides an investment thesis for both growth and fundamentals-oriented investors.

Sure, Castor Maritime’s balance sheet is likely to remain a concern. However, for now, investors are focusing on these numbers. Should the company be able to continue this growth moving forward, there’s a lot to like about how this shipping company’s balance sheet may look in a few quarters.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.



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