Is Danaos Corporation (DAC) One of the Best Marine Shipping Stocks to Invest in Now?

We recently published a list of 11 Best Marine Shipping Stocks to Invest in Now. In this article, we are going to take a look at where Danaos Corporation (NYSE:DAC) stands against other best marine shipping stocks to invest in now.

According to Dr. Shashi Kumar of the US Naval Institute, geopolitical developments tend to have a greater impact on the highly volatile shipping market compared to market forces. Since the 2007–08 financial crisis, the broader global shipping market continues to face a series of new challenges. However, the challenging conditions this industry faced in 2024 were unmatched over the past decade and a half, says Kumar. The year’s challenging conditions included the prolonged war in Ukraine, wanton Houthi attacks in the Red Sea as well as increased tensions in the South China Sea. Kumar also noted that container ships decided to avoid the Suez Canal and chose to transport goods around southern Africa, which increased transit time and greenhouse gas emissions. Despite this, the owners of these container ships saw a profitable year.

What Lies Ahead for Marine Vessels Market?

The marine vessels market is expected to reach US$133.63 billion by 2030 from US$111.10 billion in 2024, as per Research and Markets. While global trade continues to fuel the demand for different types of ships, the military navy growth has also been lending support to expand the market. Notably, the requirement for larger and more versatile vessels stems from the demand for efficient transportation of goods. Also, increasing passenger and tourism needs continue to fuel fleet expansion and technology upgrades.

The firm believes that several cruise lines have been adding more ships to cater to the needs of travelers focusing on unique experiences. Overall, the strategic fleet renewal remains critical for market improvement. New and fuel-efficient vessels have been supporting to meet environmental standards and lower costs, says Research and Markets. The transition towards sustainable shipping practices continues to become more critical to obey the international rules targeting reduced emissions.

READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.

Cargo Vessels Segment Is Expected to Lead Growth

Research and Markets believes that cargo vessels continue to become a critical part of commercial shipping. Such vessels tend to play a vital role in global trade by transporting numerous goods across the seas. With the demand for faster and more reliable shipping increasing, the broader industry remains focused on adopting new technologies. Notably, modern navigation systems, eco-friendly fuels, and automation tend to enhance efficiency, improve safety, and reduce the environmental impact. Therefore, as global trade has been expanding, cargo vessels remain critical when it comes to international commerce and economic growth.

Our Methodology

To list the 11 Best Marine Shipping Stocks to Invest in Now, we used a screener to shortlist the companies catering to the broader marine shipping industry. Next, we mentioned the hedge fund sentiments around each stock, as of Q4 2024. Finally, the stocks were arranged in ascending order of their hedge fund sentiments.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Danaos Corporation (NYSE:DAC)

Number of Hedge Fund Holders: 13

Danaos Corporation (NYSE:DAC) owns and operates containerships and drybulk vessels. In December 2024, the company added two 9,200 TEU newbuilding containerships to its order book, which have expected deliveries in 2027. The company took delivery of 6 newbuilding containerships in 2024 and 1 in January 2025. Danaos Corporation (NYSE:DAC)’s remaining orderbook has a further 15 newbuilding containership vessels with an aggregate capacity of 128,220 TEU with anticipated deliveries of 1 vessel in 2025, 3 vessels in 2026, 9 vessels in 2027, and 2 vessels in 2028.

Danaos Corporation (NYSE:DAC) remains highly insulated from the near-term market uncertainty, given its 97% coverage for 2025 and 79% for 2026 at healthy rates, protecting it from market volatility. The company’s charter backlog of $3.4 billion offers it a certainty of income and firepower to explore accretive investments. Danaos Corporation (NYSE:DAC) has chartered 13 out of its 15 newbuildings for 5 years and has managed to arrange a new $850 million facility from a bank syndicate focused on fully covering the funding of all vessels on order. The company remains focused on maintaining a strong financial position, securing long-term contracts for the vessels coming off charter, and making investments in modern, fuel-efficient container vessels.

Overall, DAC ranks 10th on our list of best marine shipping stocks to invest in now. While we acknowledge the potential of DAC as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for a deeply undervalued AI stock that is more promising than DAC but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.