Zim Integrated Shipping Services (ZIM 16.07%) reported fourth-quarter results that were slightly above expectations, but there is no end in sight to the macro headwinds that have plagued this business. Investors were hoping for more, and Zim shares were down nearly 14% as of 11:30 ET Wednesday.

Zim is treading water

Zim owns and operates a fleet of cargo ships. This is a cyclical business, and 2023 was a difficult year. Concerns about the global economy and higher interest rates led big shipping customers to cut back on cargo volumes, which depressed prices for shipping services.

Investors have worried that Zim is particularly vulnerable to a downturn because of its relatively high debt load.

Zim lost $1.23 per share in the fourth quarter on revenue of $1.21 billion, beating Wall Street's forecast for a $1.29 loss per share on sales of $1.28 billion. Revenue was down 45% in the quarter and down 59% in 2023, a reflection of poor demand.

CEO Eli Glickman said in a statement, "Against a backdrop of weakened market conditions, industry disruptions and operational challenges in 2023, ZIM's exceptional team of professionals remained resilient and intently focused on achieving operational excellence and delivering the highest level of care for our valued customers."

Zim is not predicting a quick turnaround. The company is forecasting adjusted earnings before interest, taxes, depreciation, and amortization between $850 million and $1.45 billion in 2024, compared to Wall Street's $1.207 billion estimate and $1.049 billion in 2023.

Backing out depreciation and amortization, the company is forecasting a range of between a $300 million loss and $300 million profit in 2024.

Is Zim stock a buy after its fourth-quarter results?

Glickman said the company's fleet renewal program, which is removing older, less fuel-efficient ships in favor of new ones is progressing as planned. That's good news for efficiency but is the reason for the debt concerns. Total cash decreased by $1.92 billion last year to $2.69 billion, and Zim's net leverage ratio as of year's end was 2.2 times cash.

Investors had hoped that the geopolitical issues in the Middle East, including the partial closure of the Suez Canal, would lead to rates spiking higher and help reverse some of 2023's pricing declines. But after an initial burst of optimism, it has become clear the situation is much more complicated.

For now, Zim is a wait-and-see story. There's no reason to rush in and buy this dip.