Net asset value discounts and premiums in the maritime shipping industry

Abstract

This paper examines net asset value (NAV) discounts and premiums in the setting of the maritime shipping industry. We employ a qualitative study with equity analysts as well as a quantitative study with a unique panel data, to explore and empirically investigate, respectively, the reasons underpinning NAV discounts and premiums. Our findings suggest that deviations of market capitalisation from NAV are associated with firm-specific factors, such as public maritime shipping companies' capital structure, stock liquidity, fleet acquisition cost, operating performance, institutional ownership, cost of capital, corporate governance, dividend policy, and related party transactions.

Determinants and effects of trade credit financing: Evidence from the maritime shipping industry

“…Maritime shipping companies are defined as the companies that offer seaborne transportation services to charterers and shippers via ownership of vessels. TradeWinds is a reliable source of shipping data and it has been previously used in shipping‐related empirical studies (see Andrikopoulos et al, 2022; Grammenos et al, 2007; Pouliasis et al, 2018). Maritime shipping companies, that is, holding companies that consolidate ship‐owning subsidiaries, were selected as our sample (shipping sample) because these are asset‐ and capital‐intensive companies, requiring multiple sources of capital.…”

“…The sixth independent variable is institutional ownership. Institutional ownership is closely related to the quality of corporate governance, and it is thus widely used in empirical studies in the field of finance (see Alvarez et al, 2018; Borochin & Yang, 2017), and in seaborne transportation research (see Andrikopoulos et al, 2022; Drobetz et al, 2021; Tsouknidis, 2019).…”

“…The eighth independent variable is cash liquidity, which is measured as cash and cash equivalents over total assets (see Alexandridis et al, 2020; Andrikopoulos et al, 2022; Kotcharin & Maneenop, 2020).…”

“…The third variable is asset risk, measured by the annualized standard deviation of maritime shipping companies stock price returns (see Alexandridis et al, 2020;Drobetz et al, 2013). For the investigation of trade credit effects, we have used institutional ownership, as well as two corporate governance variables, that is, board independence and CEO duality, as control variables as per common practice in shippingrelated studies (see Andreou et al, 2014;Andrikopoulos et al, 2021Andrikopoulos et al, , 2022 (Table 1).…”

“…Maritime shipping is an interesting setting to explore trade credit financing because it is a capital-intensive industry (Andrikopoulos et al, 2022). Specifically, maritime shipping companies are offering transportation services through ownership of vessels.…”