Evergreen Marine, Asia’s Most Dramatic Hot-to-Cold Stock, Slides as China Bet Wanes

By Yu-Huay Sun and Richard Frost (Bloomberg) — A Taiwanese shipping company is enduring the sharpest swing in fortunes among Asian shares.

Evergreen Marine Corp., which operates the region’s second-largest container fleet, surged 39 percent last month in the top performance among members of the MSCI Asia Pacific Index. Behind the euphoria were bets that rising demand from China would spur a surge in freight rates, bolstering earnings, according to local brokerage President Capital Management. Such optimism was brief: rates fell, not rose, and the shares have tumbled 17 percent in September.

Volatility in the company — which started out in 1968 with a single used bulk vessel — is now the highest in eight years, which may deter less long-term investors. Analysts see some brightness ahead, helped by the company’s strong quarterly earnings; their consensus forecast suggests shares may gain 10 percent over the next 12 months.

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