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Earnings Yield and Predictability in the Dry Bulk Shipping Industry

Nomikos, N. ORCID: 0000-0003-1621-2991 and Moutzouris, I. (2019). Earnings Yield and Predictability in the Dry Bulk Shipping Industry. Transportation Research Part E: Logistics and Transportation Review,

Abstract

We examine the relation between vessel prices, net earningsand holding period returns in the dry bulk shipping industry. In doing so, we provide a framework for pricing shipping assets,with finite economic lives and also subject to wear and tear.Shipping earnings yields negatively forecast future net earnings growth while there is no consistent evidence of time-varying risk premia. We provide an economic interpretation for the obtained resultsand argue that the investment decisions of shipowners affect the current price of the asset through the expectedcash flow stream,thus implying cash flow predictability

Publication Type: Article
Additional Information: © 2019 Elsevier. This manuscript version is made available under the CC-BY-NC-ND 4.0 license http://creativecommons.org/licenses/by-nc-nd/4.0/
Publisher Keywords: Valuation of Transportation Assets; Shipping CashFlow Predictability; Shipping Risk Premia; Variance Decomposition of Earnings
Subjects: H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HE Transportation and Communications
H Social Sciences > HG Finance
Departments: Cass Business School > Finance
URI: http://openaccess.city.ac.uk/id/eprint/21819
[img] Text - Accepted Version
This document is not freely accessible due to copyright restrictions.
Available under License Creative Commons Attribution Non-commercial No Derivatives.

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