What happened

Shares of containership operator Costamare (NYSE:CMRE) popped 11% in early trading on the Nasdaq today, before settling down to about a 7.8% gain at noon EDT. Now, it's possible that this Motley Fool article had something to do with that.

But if you ask me, if you own shares of Costamare, it's actually Citigroup you should be thanking.

Docked containership loaded with shipping containers

Is it time to load up on containership stocks? Image source: Getty Images.

So what

Yesterday, you see, Citigroup announced a rare "double upgrade" of Costamare stock. Executing a perfect 180-degree turnabout, Citi reversed its rating on the stock from "sell" to "buy," and assigned the transportation ship operator a $6.50 price target. This news spiked Costamare stock 12.9% in Monday trading, and it seems the enthusiasm is continuing into today.

Now what

Citi increased its 2020 and 2021 EBITDA estimates by 5% and 12% -- to $312 million and $335 million, respectively, according to a report StreetInsider.com covered yesterday. Why? "Higher timecharter rate assumptions across the balance of 2020," says the analyst, will continue "into 2021."

Higher prices for container shipping logically imply higher revenue, more profits, and a higher target price on Costamare stock. Moreover, Citi argues that because the outlook for the container shipping market as a whole is improving, Costamare deserves a larger multiple to earnings -- 8 times instead of 7 times previously.

That all adds up to brighter prospects for Costamare stock today.