Danaos Corporation Common Stock (DAC)

FairStock Score: 83/100 — HIGH CONVICTION

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look at Danaos as a pass-through asset play in an inherently cyclical industry. It owns and operates containerships and drybulk vessels, with 75 containerships totaling 477,230 TEUs and 27 more container vessels under construction. Shipping has no durable moat: rates are set by global trade, fuel, and vessel supply. But the current numbers are striking. At the 2026-10-13 close of $164.93, FairStock calculations show a P/E of 5.58, P/B of 0.74, EV/EBITDA of 3.15, and FCF yield of 9.1%. The Graham Number is $384.93, implying a 57.15% margin of safety, and PEG is 0.25. In the second quarter of 2026, Danaos reported revenue of $274.4 million and net income of $151.8 million, a 55.33% net margin. Return on equity is 14.14%, debt-to-equity is 0.30, and Altman Z-score is 2.24, reasonable but not fortress-like. Piotroski is 6/9. The biggest question is durability: containership earnings can collapse when rates normalize, and new vessel construction adds supply. A 2.23% dividend yield and 0.86 beta soften the ride, but this is not a buy-and-forget compounder. The price is cheap on trailing numbers; the risk is that those numbers are near a cycle peak. I would want to see contract coverage, fleet utilization, and free cash flow convert into dividends or debt reduction before trusting the margin of safety.

In plain English: Danaos owns and operates ships that carry container cargo and dry bulk goods. The business looks profitable, with modest debt and a small dividend, but shipping is a cyclical industry where rates can change quickly. At the October 13, 2026 closing price of $164.93, the stock looks inexpensive compared with its reported profits and the value of its assets.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer