2025-10-19 15:58Summary of Key Points from the Conference Call Industry Overview: Global Logistics Core Insights and Arguments - Deceleration in Demand: Signs of deceleration in ocean and air freight demand are emerging as ocean volume growth slowed to +3% globally in August, with a significant decline of -12% in Transpacific Eastbound volumes [1][3]. Air freight volumes also showed a modest deceleration in September, likely due to the expiration of the de minimis exemption [5][23]. - Pressure on Ocean Rates: Ocean freight rates are at their lowest levels since 2023, with the SCFI down over 50% year-to-date [3][20]. Key indicators such as the SCFI and WCI have seen declines of 54% and 58% respectively [20]. - Orderbook Expansion: The container shipping orderbook grew by +6% in Q3, with new orders equivalent to 3.4% of the in-service fleet, indicating continued investment despite oversupply risks [4][21]. - Airfreight Performance: Airfreight demand grew by 4% in August, but the growth rate moderated in September, with revenues below last year's levels [5][23]. The expiration of the US de minimis exemption is expected to impact future demand [23]. - Surface Freight Outlook: U.S. surface rates contracted in June and are expected to remain flat or decline in the second half of the year due to a softer freight outlook [6][24]. Additional Important Insights - Global Trade Volumes: Global trade volumes increased by 4.9% YoY in July, driven by a 6% rise in emerging market exports, while U.S. and European exports remained largely unchanged [2][18]. - PMI Indicators: September PMIs showed an increase in China (+0.7pt to 51.2) and the U.S. (+0.4pt to 49.1), while Europe saw a decrease for the first time this year (-0.9pt to 49.8) [2][18]. - Market Sentiment: The sentiment in the logistics sector remains weak, with companies expressing pessimism regarding international ocean demand and potential challenges in achieving a meaningful peak season [3][19]. Company Ratings and Valuations Key Company Ratings - DSV: Rated Outperform with a target price of DKK 1,700. Expected to become the largest freight forwarder post-acquisition of DB Schenker [9]. - DHL: Rated Outperform with a target price of €42.00. Strongly levered to e-commerce and world trade, with a solid long-term holding outlook [10]. - Kuehne+Nagel: Rated Market-Perform with a target price of CHF 165. Underperformance in volume growth noted, with execution issues impacting investor sentiment [11]. - AP Moller - Maersk: Rated Underperform with a target price of DKK 10,600. Facing challenges in container shipping with declining spot rates and a high orderbook [12]. Valuation Comparisons - Valuation Metrics: DSV shows a strong growth trajectory with an expected EPS of DKK 100+ by 2028, while Maersk's strategy has been criticized for failing to deliver promised synergies [9][12]. - Market Cap and Share Buybacks: DSV is projected to repurchase DKK 24 billion of shares annually, compared to its current market cap of DKK 310,654 million [9]. Conclusion The global logistics industry is experiencing a notable deceleration in demand across both ocean and air freight sectors, with significant pressure on rates and a growing orderbook despite oversupply risks. Companies like DSV and DHL are positioned favorably, while others like Maersk face challenges. The overall sentiment in the logistics sector remains cautious as companies navigate a complex market landscape.