Why Shares of Navios Maritime Holdings Inc. Jumped Today

Is this meaningful or just another movement?

Travis Hoium
Travis Hoium
Mar 6, 2014 at 2:59PM
Industrials

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Navios Maritime Holdings (NYSE:NM) jumped 10% briefly this morning after being upgraded by an analyst.

So what: Analysts at Stifel Nicolaus upgraded the stock to a buy and raised their price target to $14. Shares are currently trading for about $11.30 so that indicates about a 24% upside from the current price.  

Now what: The reason given for the more bullish rating is improved demand for Capesize vessels. It's true that rates are up in recent months but there's not a full-fledged recovery from oversupply and weak demand after the recession. This is still early in the recovery and prices are volatile so investors need to know that this is a high-risk bet in Navios Maritime today.