Should you own shipping and containers stocks? Jefferies weighs in

Investing.com -- Jefferies analysts warned that container shipping markets are “limping into 4Q after [a] volatile up-and-down market for much of 2025,” with falling freight rates and cautious outlooks weighing on sentiment.

According to Jefferies, “freight rates have fallen below leading-cost operators’ break-even for the first time since late 2023.”

Spot rates on main trade lanes are now averaging just over $1,000 per forty-foot equivalent unit, compared with all-in break-even costs of about $1,100/teu for carriers such as Maersk and Hapag-Lloyd.

The firm noted that this is “the lowest since December 2023, just before Red Sea diversions began soaking up the global fleet’s excess capacity.”

While third-quarter performance was better than expected, Jefferies said the “exit-rate is considerably softer” and cut fourth-quarter estimates.

The Shanghai Containerized Freight Index averaged 18% higher than in 2Q, but Jefferies highlighted that last week’s reading of 1,115 was down 26% from the 3Q average.

Looking ahead, contract negotiations for 2026 could prove difficult. Jefferies said “there is risk for a material adjustment lower” in Europe, with Asia-Europe spot rates recently falling below $1,250/teu, well under last year’s 2025 contract levels of $1,500–$1,600/teu.

Despite near-term weakness, the bank pointed to early signs of a turnaround. “US retail, wholesale and manufacturing inventory growth had been outpacing sales growth… but in recent months sales growth has outstripped inventories,” Jefferies wrote, adding that this may support a “normal” peak season in 2026.

Still, Jefferies remains cautious. “We remain Hold-rated across our ocean liner coverage group,” the analysts said, citing “uncertain outlook and down-trending earnings” while acknowledging carriers’ strong balance sheets and cash reserves.

“We maintain our Hold ratings on MAERSK, HLAG, MATX and ZIM,” said the firm.

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