Using Big Fund Insights for Small Investor Profits: The Shipping Market

Coming off records on multiple indexes last week, markets seem to be losing steam for now, with the Dow flat and the S&P and NASDAQ down at the time of this writing.

Although markets were relatively quiet today, awaiting a slew of earnings reports tomorrow, NewsQuantified members still received hundreds of news alerts. Often, a low volume market presents a great opportunity to pursue trades based on a slightly longer time frame.

That’s where our Analyst Actions come in. We record any “rating” change on stocks issued by major financial advisory firms. Then, we rate these changes to understand which groups do the best job predicting market sentiment. NewsQuantified users can easily filter out the noise of financial industry chatter to focus on strong predictions from quality analysts.

Our users can take advantage of this information however they like. If you truly buy into the underlying analysis, you can hold the stock for the medium term, waiting for its price to float near the new price target. Or, you can take advantage of Analyst Actions as pure momentum plays. Rather than waiting for the Analyst’s prediction to come true, you can make shorter-term trades based on the momentum generated by the ratings change itself.

 CAI International (CAI): upgraded by Cowen Capital.

Cowen Capital is a great source of profitable trades for NQ users: they win on 74% of their rating changes. Today, Cowen Capital upgraded CAI International, which was sitting at $37 at the time of the news. Cowen Capital has shifted from a “market perform” ($36 price target) outlook on CAI to an “outperform” outlook with a $46 price target.

Investors seem to agree with Cowen’s analysis so far, with the stock already gaining around 5% at the time of this writing. If their new price target is correct, substantial upside remains.

CAI International is focused on the logistics-transportation market, leasing containers, rail cars, and other cargo transport equipment across the world. Their stock has performed well this year, with strong earnings driving price appreciation.

Cowen’s upgrade was based on the fundamental strength of the container market moving forward. They noted high utilization rates (95%+) of worldwide shipping containers, with leasing rates earned by CAI tripling from the same time last year.  This evidence suggests a tight container market for the foreseeable future.

Cowen and CAI believe it will take time for container makers to alleviated this supply bottleneck. In the meantime, container leasers like CAI appear poised to take advantage of the tight market.

Diverse Plays, Great Profits: All in a single news day.

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