Core Viewpoint - Daiwa's report indicates that Pacific Shipping's 2025 earnings are expected to fall short of projections, suggesting that the recent strong rebound in stock price may not be sustainable [1] Summary by Relevant Sections Earnings Forecast - Daiwa downgraded its rating for Pacific Shipping from "Buy" to "Underperform" due to high current valuations, which are 3 standard deviations above the three-year average, and limited stock price catalysts [1] - The target price was raised from HKD 3 to HKD 3.25 [1] - Earnings per share forecasts for 2026 and 2027 were cut by 46% to 53% based on the latest time charter equivalent (TCE) assumptions [1] TCE Outlook - The management's discussion and forward contract rates suggest a relatively optimistic TCE outlook for this year [1] - For 2026, it is expected that 41% and 56% of flexible and super-flexible vessels will have operating dates locked in at daily net charter rates of USD 11,370 and USD 14,050, respectively, compared to USD 11,490 and USD 12,850 in 2025, indicating limited upside potential for TCE [1] Share Buyback Potential - The net asset value (NAV) is below the current market value, making share buybacks unlikely at the current valuation levels [1]