IMPORTANT DISCLAIMER: Blank Capital Research ("BCR") is a technology platform, not a registered investment advisor or broker-dealer. The algorithmically generated signals, scores, and rankings provided on this site ("God Mode" Signals) are for informational and research purposes only and do not constitute financial advice, investment recommendations, or an offer to sell or solicit an offer to buy any securities.
HYPOTHETICAL PERFORMANCE RESULTS: The "timing scores" and "regime signals" displayed are based on quantitative models. Hypothetical or simulated performance results have certain inherent limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, since the trades have not actually been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity.
RISK OF LOSS: Trading in financial markets involves a high degree of risk and may result in the loss of your entire investment. Data provided by third-party sources (Intrinio, Snowflake) is believed to be reliable but is not guaranteed for accuracy or completeness. Past performance is not indicative of future results.
Relative valuation derived from Industrials sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 37.7GRADE D
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
59.0%
Sector: 8.9%
Dividend Analysis audit
No Dividend
This company does not currently pay a dividend.
Analyst Projections
Analyst Consensus
Unlock Valuation Tools
Sign up for free access to institutional-quality research tools.
Based on our 6-factor quantitative model, Danaos Corp (DAC) receives a "Hold" rating with a composite score of 54.4/100, ranked #454 out of 4446 stocks. Key factor scores: Quality 38/100, Value 87/100, Momentum 70/100. This is quantitative analysis only — not investment advice.
Danaos Corp (DAC) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does Danaos Corp Do?
Danaos Corporation, together with its subsidiaries, owns and operates containerships in Australia, Asia, Europe, and the United States. The company offers seaborne transportation services, such as chartering its vessels to liner companies. As of February 28, 2022, it had a fleet of 71 containerships aggregating 436,589 twenty-foot equivalent units in capacity. The company was formerly known as Danaos Holdings Limited and changed its name to Danaos Corporation in October 2005. Danaos Corporation was founded in 1963 and is based in Piraeus, Greece. Danaos Corp (DAC) is classified as a mid-cap stock in the Industrials sector, specifically within the Transportation industry. The company is led by CEO John Coustas and employs approximately 1,720 people. With a market capitalization of $2.1B, DAC is one of the notable companies in the Industrials sector.
Danaos Corp (DAC) Stock Rating — Hold (April 2026)
As of April 2026, Danaos Corp receives a Hold rating with a composite score of 54.4/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.DAC ranks #454 out of 4,446 stocks in our coverage universe. Within the Industrials sector, Danaos Corp ranks #75 of 752 stocks, placing it in the top 10% of its Industrials peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
DAC Stock Price and 52-Week Range
Danaos Corp (DAC) currently trades at $115.75. The stock lost $0.68 (0.6%) in the most recent trading session. The 52-week high for DAC is $118.44, which means the stock is currently trading -2.3% from its annual peak. The 52-week low is $65.40, putting the stock 77.0% above its annual trough. Recent trading volume was 36K shares, suggesting relatively thin trading activity.
Is DAC Overvalued or Undervalued? — Valuation Analysis
Danaos Corp (DAC) carries a value factor score of 87/100 in the Blank Capital model, suggesting the stock trades at a meaningful discount to its fundamental earning power. The trailing price-to-earnings ratio is 4.45x, compared to the Industrials sector average of 28.33x — a discount of 84%. The price-to-book ratio stands at 0.61x, versus the sector average of 2.23x. The price-to-sales ratio is 0.52x, compared to 0.50x for the average Industrials stock. On an enterprise value basis, DAC trades at 0.83x EV/EBITDA, versus 5.70x for the sector.
Based on these multiples, Danaos Corp appears attractively valued relative to both its sector peers and the broader market. Value-oriented investors may find the current entry point compelling, particularly if the company's fundamental quality metrics also score well.
Danaos Corp Profitability — ROE, Margins, and Quality Score
Danaos Corp (DAC) earns a quality factor score of 38/100, signaling below-average profitability metrics relative to the broader market. The return on equity (ROE) is 59.0%, compared to the Industrials sector average of 8.9%, which demonstrates strong shareholder value creation. Return on assets (ROA) comes in at 46.5% versus the sector average of 3.3%.
On a margin basis, Danaos Corp reports gross margins of 100.0%, compared to 35.8% for the sector. The operating margin is 53.3% (sector: 6.2%). Net profit margin stands at 49.8%, versus 3.9% for the average Industrials stock. Profitability is below benchmark levels, which may reflect industry headwinds, elevated reinvestment, or structural challenges.
DAC Debt, Balance Sheet, and Financial Health
Danaos Corp has a debt-to-equity ratio of 21.0%, compared to the Industrials sector average of 70.0%. The low leverage indicates a conservative balance sheet with significant financial flexibility. Total debt on the balance sheet is $735M. Cash and equivalents stand at $453M.
DAC has a beta of 0.68, meaning it is less volatile than the S&P 500, making it a relatively defensive holding. The stability factor score for Danaos Corp is 79/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
Danaos Corp Revenue and Earnings History — Quarterly Trend
In TTM 2026, Danaos Corp reported revenue of $1.01B and earnings per share (EPS) of $26.15. Net income for the quarter was $505M. Gross margin was 100.0%. Operating income came in at $541M.
In FY 2024, Danaos Corp reported revenue of $1.01B and earnings per share (EPS) of $26.15. Net income for the quarter was $505M. Gross margin was 100.0%. Revenue grew 4.2% year-over-year compared to FY 2023. Operating income came in at $541M.
In FY 2023, Danaos Corp reported revenue of $974M and earnings per share (EPS) of $28.99. Net income for the quarter was $576M. Gross margin was 100.0%. Revenue grew -2.0% year-over-year compared to FY 2022. Operating income came in at $581M.
In FY 2022, Danaos Corp reported revenue of $993M and earnings per share (EPS) of $27.30. Net income for the quarter was $559M. Gross margin was 100.0%. Revenue grew 44.1% year-over-year compared to FY 2021. Operating income came in at $653M.
Over the past 8 quarters, Danaos Corp has demonstrated a growth trajectory, with revenue expanding from $459M to $1.01B. Investors analyzing DAC stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
DAC Dividend Yield and Income Analysis
Danaos Corp (DAC) does not currently pay a dividend. This is common among smaller companies in the Transportation industry that prefer to reinvest cash flows into business expansion rather than returning capital to shareholders. Income-focused investors looking for Industrials dividend stocks may want to explore other Industrials stocks or use the stock screener to filter by dividend yield.
DAC Momentum and Technical Analysis Profile
Danaos Corp (DAC) has a momentum factor score of 70/100, indicating strong price momentum with the stock outperforming the majority of the market over recent periods. Stocks with high momentum scores have historically tended to continue their outperformance in the near term. The investment factor score is 28/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 18/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
DAC vs Competitors — Industrials Sector Ranking and Peer Comparison
Comparing DAC against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full DAC vs S&P 500 (SPY) comparison to assess how Danaos Corp stacks up against the broader market across all factor dimensions.
DAC Next Earnings Date
No upcoming earnings date has been announced for Danaos Corp (DAC) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy DAC? — Investment Thesis Summary
Danaos Corp presents a balanced picture with arguments on both sides. The quality score of 38/100 flags below-average profitability. The value score of 87/100 suggests attractive pricing relative to fundamentals. Price momentum is positive at 70/100, suggesting the trend favors buyers. Low volatility (stability score 79/100) reduces downside risk.
In summary, Danaos Corp (DAC) earns a Hold rating with a composite score of 54.4/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on DAC stock.
We'll email you when stocks you follow change their composite rating.
Institutional Research Dossier
Danaos Corp (DAC) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Danaos Corporation (DAC) receives a Hold rating, reflecting a balanced view of its compelling valuation metrics against concerns about future growth and capital allocation. While the company exhibits strong profitability and trades at a significant discount to its sector on P/E and EV/EBITDA bases, its recent negative free cash flow and relatively low investment score raise questions about its ability to sustain its performance in a potentially softening shipping market. The primary takeaway is that while DAC presents a value opportunity, investors should carefully consider the cyclical nature of the containership industry and the company's capital deployment strategy.
The company's impressive historical profitability, as evidenced by its high ROE and margins, is largely a result of the extraordinary conditions in the containership market over the past few years. As these conditions normalize, DAC's earnings are likely to decline, potentially eroding its current valuation appeal. Therefore, a Hold rating is warranted until there is greater clarity on the company's ability to navigate the evolving market dynamics and effectively allocate capital.
Business Strategy & Overview
Danaos Corporation operates as a containership owner, chartering its vessels to liner companies. The company's primary revenue stream is derived from time charter agreements, where vessels are leased out for a specified period at a predetermined rate. Danaos does not directly engage in the operation of shipping routes or the management of cargo; instead, it focuses on owning and maintaining a fleet of containerships and securing charter contracts. As of February 2022, Danaos had a fleet of 71 containerships with a total capacity of 436,589 TEU (twenty-foot equivalent units).
The company's strategy revolves around maintaining a modern and efficient fleet, securing long-term charter contracts, and managing its operating costs effectively. By focusing on larger, more fuel-efficient vessels, Danaos aims to attract premium charter rates and reduce its environmental footprint. The company also seeks to diversify its customer base to mitigate the risk of over-reliance on any single liner company. Danaos's success is heavily dependent on the overall health of the global economy and the demand for seaborne transportation of goods.
The containership industry is highly cyclical, with charter rates fluctuating significantly based on supply and demand dynamics. During periods of strong economic growth and high trade volumes, charter rates tend to rise, benefiting containership owners like Danaos. Conversely, during economic downturns or periods of overcapacity, charter rates can decline sharply, negatively impacting profitability. Danaos attempts to mitigate this cyclicality by securing long-term charter contracts, providing a degree of revenue visibility and stability.
Danaos competes with other containership owners, as well as with alternative modes of transportation, such as air freight and rail. The company's competitive advantage lies in its ability to offer reliable and cost-effective transportation solutions to liner companies. Danaos also benefits from its long-standing relationships with major liner companies and its reputation for operational excellence. However, the industry is becoming increasingly competitive, with new entrants and consolidation among existing players.
Execution Benchmarks audit
Gross Margin
Core pricing power
100.0%
Sector: 35.8%
+179% VS SCTR
Economic Moat Analysis
Danaos's economic moat is likely Narrow. While the company benefits from certain advantages, they are not substantial enough to create a wide and sustainable competitive edge. The primary source of its moat stems from its established relationships with major liner companies and its reputation for reliable service. These relationships provide a degree of stickiness, as liner companies are often hesitant to switch to unproven operators.
However, the containership industry is characterized by intense competition and relatively low switching costs. Liner companies can easily switch between different containership owners based on price and availability. Furthermore, the industry is subject to significant fluctuations in supply and demand, which can erode the pricing power of containership owners. While Danaos's fleet of modern and fuel-efficient vessels provides a cost advantage, this advantage is not unique and can be replicated by competitors.
The company's intangible assets, such as its brand reputation and operational expertise, contribute to its narrow moat. However, these assets are not easily quantifiable and are subject to erosion over time. Danaos does not possess any significant network effects or efficient scale advantages. The containership industry is not characterized by strong network effects, as the value of a containership does not increase significantly as more liner companies use it. Similarly, Danaos does not benefit from significant economies of scale, as the cost of operating a containership does not decrease dramatically as the fleet size increases.
The company's gross margin of 100% is misleading, as it reflects the accounting treatment of charter revenue and operating expenses. While Danaos's operating margin is significantly higher than the sector average, this is largely due to the favorable market conditions in recent years. As these conditions normalize, Danaos's operating margin is likely to decline, reducing its competitive advantage. Therefore, while Danaos possesses a narrow moat, it is not a wide and sustainable one.
Financial Health & Profitability
Danaos exhibits a mixed financial profile. The company's revenue has shown volatility over the past decade, influenced by the cyclical nature of the containership industry. While revenue has increased significantly in recent years, reaching $1.01 billion in FY2024, this growth is largely attributable to the surge in charter rates during the pandemic. Prior to this period, revenue was relatively stable, fluctuating between $447 million and $568 million.
Profitability metrics, such as ROE, gross margin, operating margin, and net margin, are exceptionally strong compared to the industrials sector. The company's ROE of 59.0% far exceeds the sector average of 9.2%, while its gross margin of 100.0%, operating margin of 53.3%, and net margin of 49.8% are also significantly higher than the sector averages. However, these high margins are likely unsustainable in the long term, as they are driven by the extraordinary conditions in the containership market.
Danaos's balance sheet appears relatively healthy, with total cash of $453.38 million and total debt of $734.78 million. The company's debt-to-equity ratio of 21.00 is significantly lower than the sector average of 70.00, indicating a conservative approach to leverage. However, the company's current ratio is not available, making it difficult to assess its short-term liquidity position. The company's free cash flow has been volatile, with negative free cash flow of $-16.90 million in FY2024. This is a concern, as it suggests that the company is not generating enough cash to cover its capital expenditures and other obligations.
The historical financial data reveals a pattern of strong free cash flow generation in some years, followed by periods of negative free cash flow. This volatility is likely due to the timing of vessel acquisitions and disposals, as well as fluctuations in charter rates. The company's ability to generate consistent free cash flow will be crucial for its long-term financial health. The negative FCF in the most recent year is a red flag that needs to be monitored closely.
Valuation Assessment
Danaos appears significantly undervalued based on several key valuation metrics. The company's P/E ratio of 4.3x is substantially lower than the industrials sector average of 27.7x, suggesting that the market is discounting its earnings potential. Similarly, its EV/EBITDA ratio of 0.8x is significantly lower than the sector average of 5.7x, indicating that the company's enterprise value is low relative to its earnings before interest, taxes, depreciation, and amortization.
However, these low multiples may reflect the market's expectation that Danaos's earnings will decline in the future as charter rates normalize. The company's recent negative free cash flow also raises concerns about its ability to sustain its current level of profitability. While the company's historical growth has been impressive, it is important to consider the cyclical nature of the containership industry and the potential for future downturns.
A discounted cash flow (DCF) analysis would be necessary to determine the intrinsic value of Danaos. However, given the volatility of the company's free cash flow and the uncertainty surrounding future charter rates, a DCF analysis would be highly sensitive to the assumptions used. A conservative approach would be to assume a gradual decline in charter rates over the next few years, followed by a period of stable growth.
Even with conservative assumptions, Danaos's valuation appears attractive. However, investors should be aware of the risks associated with investing in a cyclical industry and the potential for earnings to decline. The market may be pricing in a significant decline in earnings, which could limit the upside potential of the stock. While the valuation is compelling, the risks warrant a Hold rating.
Risk & Uncertainty
Danaos faces several key risks that could negatively impact its business and financial performance. The most significant risk is the cyclical nature of the containership industry. Charter rates are highly volatile and can fluctuate significantly based on supply and demand dynamics. A downturn in the global economy or an increase in the supply of containerships could lead to a sharp decline in charter rates, reducing Danaos's revenue and profitability.
Another risk is the company's reliance on a limited number of liner companies. If one or more of Danaos's major customers were to experience financial difficulties or reduce their demand for containerships, it could have a material adverse effect on the company's business. The company's concentration risk is mitigated to some extent by its diversified customer base, but it remains a significant concern.
The company also faces regulatory risks related to environmental regulations. The shipping industry is subject to increasingly stringent environmental regulations, which could require Danaos to invest in new technologies or modify its vessels to comply with these regulations. These investments could be costly and could reduce the company's profitability. Furthermore, the company's debt levels, while lower than the sector average, still represent a significant financial obligation. The company's ability to service its debt will depend on its ability to generate sufficient cash flow.
Finally, the company's capital allocation decisions pose a risk. The company's recent negative free cash flow raises questions about its ability to effectively allocate capital. If the company makes poor investment decisions or overpays for acquisitions, it could negatively impact its long-term financial performance. The company's investment score of 28/100 reflects these concerns.
Bulls Say / Bears Say
The Bull Case
BULL VIEWDanaos is trading at a ridiculously low valuation, with a P/E and EV/EBITDA far below sector averages, offering substantial upside potential as the market recognizes its inherent value.
BULL VIEWThe company's strong balance sheet and conservative debt levels provide a buffer against industry downturns, allowing it to weather any potential storms and emerge stronger.
BULL VIEWDanaos's modern and fuel-efficient fleet positions it favorably to capitalize on increasing demand for environmentally friendly shipping solutions, attracting premium charter rates.
The Bear Case
BEAR VIEWThe current high charter rates are unsustainable, and as they normalize, Danaos's earnings will plummet, justifying the low valuation multiples.
BEAR VIEWDanaos's recent negative free cash flow indicates potential financial strain and raises concerns about its ability to maintain its fleet and service its debt.
BEAR VIEWThe cyclical nature of the containership industry makes Danaos a risky investment, as a global economic slowdown could trigger a sharp decline in charter rates and severely impact its profitability.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score DAC and 4,400+ other equities.
Danaos Corp exhibits a 60% valuation discount relative to institutional benchmarks. This represents a constructive entry window based on current multiples.
Return on Assets
Efficiency of asset utilization
46.5%
Sector: 3.3%
Gross Margin
Pricing power and cost efficiency
100.0%
Sector: 35.8%
Operating Margin
Core business profitability
53.3%
Sector: 6.2%
Net Margin
Bottom-line profitability
49.8%
Sector: 3.9%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
