ZIM Stock: Bullish 45%-Yielder Reports Strong Q1
June 25, 2025
ZIM Integrated Shipping Stock Trading at 52-Week High
Time to take another look at ZIM stock!
ZIM Integrated Shipping Services Ltd (NYSE:ZIM) reported an “outstanding” 2024, with that momentum carrying into 2025. Strong first-quarter results come on the heels of a transformed fleet, enhanced cost structure, and longer shipping routes.
The company also reaffirmed its full-year guidance for adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and operating income, or earnings before interest and taxes (EBIT).
These dynamics have helped lift ZIM stock to its highest trading levels since August 2022. Strong results and guidance are also allowing ZIM Integrated Shipping to continue to return capital to shareholders in the form of a high-yield dividend.
About the Company
Founded in Israel in 1945, ZIM Integrated Shipping is a global container shipping company operating 141 vessels. This includes 126 containership and 15 car carriers. The 141 vessels have total carrying capacity of 774,000 twenty-foot equivalent units (TEUs). A TEU is the length of a container. (Source: “Investor Presentation Q1 2025 Financial Results,” ZIM Integrated Shipping Services Ltd, May 19, 2025.)
It has operations in more than 100 countries, serving approximately 33,000 customers in over 300 ports. Core routes include the Pacific, Latin America, Atlantic, Cross-Suez, and Intra-Asia routes.
“Strong” Q1 2025 Results
ZIM Integrated Shipping reported pretty strong first-quarter results. Revenue increased 28% on an annual basis to $2.01 billion. (Source: “ZIM Reports Financial Results for the First Quarter of 2025,” ZIM Integrated Shipping Services Ltd, May 19, 2025.)
During the first quarter of this year, the shipper carried 944,000 TEUs, compared to 846,000 TEUs in the first quarter of 2024. The average freight rate per TEU was $1,776, compared to $1,452 for the first quarter of 2024.
ZIM Integrated Shipping’s net income was up 222% at $296.0 million, or $2.45 per share. Adjusted EBITDA rallied 82% on an annual basis to $427.0 million, while operating income (EBIT) was up 178% on an annual basis at $464.0 million. Adjusted EBIT advanced 177% to $463.0 million.
The company’s net cash generated from operating activities more than doubled to $855.0 million.
Its total cash position increased by $230.0 million, from $3.14 billion as of December 31, 2024, to $3.37 billion as of March 31, 2025. ZIM Integrated Shipping’s net debt decreased by $382.0 million to $2.49 billion.
Commenting on the results, Eli Glickman, the company’s president and chief executive officer, said, “ZIM began the year with positive momentum, delivering 12% carried volume growth and strong earnings in the first quarter.”
Glickman concluded, “Despite the heightened level of uncertainty, we have reaffirmed our 2025 outlook of Adjusted EBITDA between $1.6 billion and $2.2 billion and Adjusted EBIT between $350 million and $950 million.”
Q2 Dividend of $0.74/Share with ZIM Stock
ZIM’s dividend payout is tied to profitability, so it will vary from quarter to quarter.
Is it reliable?
We don’t have a long history to go on. ZIM Integrated Shipping only paid its first dividend in August 2021. The company suspended it in the back half of 2023 before reinstating it in June 2024. ZIM has paid out five consecutive dividends since then.
In December 2024, ZIM stock paid out a regular dividend of $2.81 per share, plus a special dividend of $0.84 per share, for a total of $3.65 per share. In the first quarter, it paid out $3.17 per share, then, in the second quarter, it declared a dividend of $0.74 per share, or $7.88 per share, for a forward dividend yield of 45%.
The big question is: is ZIM stock’s dividend safe?
Right now it is. The payout ratio is just 36.6%, which is well below the 90% threshold I’m willing to consider.
ZIM Stock Has 45% Upside Potential
ZIM stock is having a good year, with the company coming off an “outstanding” 2024 and a strong start to 2025. As of June 16, the stock is crushing the broader market, up 16% over the last six months and 54% over the last year. ZIM stock is also up more than 18% since we last looked at it in March.
On May 19, ZIM hit a new 52-week high of $19.92; it continues to trade near that level. More gains are expected for the stock, with Wall Street analysts providing a 12-month share price high target of $19.00.
Chart courtesy of StockCharts.com
The Lowdown on ZIM Stock
While the marine shipping industry can be uncertain, ZIM Integrated Shipping Services Ltd is performing exceptionally well right now. It reported strong fourth-quarter and full-year financial results, with that momentum carrying into 2025.
It continues to have a strong balance sheet and liquidity, and despite heightened levels of uncertainty, ZIM has reaffirmed its 2025 outlook for adjusted EBITDA between $1.6 billion and $2.2 billion and adjusted EBIT between $350.0 million and $950.0 million.
