Will the ZIM Stock Dividend Be Returning in 2024?

The ZIM stock dividend collapse of 2023 could make for an epic comeback in 2024. With a dividend payout as high as $27.55 per share, it’s no wonder ZIM stock made headlines. If you’re wondering if the ZIM stock dividend is returning in 2024, stick around. Today we’ll discuss the possible return of the ZIM stock dividend in addition to whether or not ZIM stock is a buy in 2024.

For those who are unfamiliar, ZIM Integrated Shipping Services Ltd. is an international shipping company that provides container shipping and logistics services. The company is based in Israel and operates a global network, offering containerized shipping services to various destinations worldwide.

ZIM is involved in transporting goods and cargo through its fleet of container ships. The company plays a significant role in the maritime industry, facilitating the global movement of goods and contributing to international trade. 

Basically, ZIM’s bread and butter is sailing containers between Asia and Europe, North America, and Latin America. Think iPhones and avocados, all thanks to ZIM.

In 2022, they reported record profits of $4.6 billion. 2023, however, was a different story for the shipping company. Let’s get into the details… 

ZIM Stock Dividend Amid Conflict in Israel 

As mentioned before, ZIM Integrated Shipping Services Ltd. is based in Israel. If you’ve been paying attention to the news at all, you know Israel is involved in a brutal conflict right now. While it may be coarse to think of investments while a war is being fought, it is the reality of the world and finances. 

The first question potential ZIM investors may have is, will the company still run during the conflict? Yes. ZIM has announced that it will not cease production or let the conflict with Palastine affect their bottom line. 

Additionally, only ~10% of ZIM’s business takes place in Isreal. Considering that 90% of their business will be unaffected by the conflict, it should not negatively impact ZIM stock too much. But what does that mean for the dividend? 

Unfortunately, the conflict will probably not help bring the dividend back to investors any quicker. ZIM decided to cut their dividend in June of 2023 because it became to unfeasible to keep paying. 

Will ZIM Stock Dividend Come Back in 2024? 

As of now, it does not seem likely. ZIM saw monumental growth from 2021-2022 mainly due to the pandemic. You see, one year prior in 2020, the shipping industry was in shambles. Do you remember headlines of cargo ships waiting in line for weeks to make port? 

Once the roadblocks were ironed out, the shipping industry burst with growth. ZIM, among other companies, was able to reap the rewards of global shipping routes opening up again. What’s interesting though is, similar headlines started appearing in June 2023. 

Shortly after ports began experiencing backups again, ZIM announced that they would be cutting their dividend. Experts are lamenting that we are in a bit of a shipping crisis at the moment. Some even say it echoes the shipping crisis provoked by the pandemic. 

Could this set ZIM stock up for a rise similar to the one they experienced last year?

It certainly could. But will that growth be enough to bring the high-dividend yield back? I don’t think so. If and when ZIM stock dividend makes its return, it will most likely be a much more modest payout. While ZIM stock could see significant growth in 2024, I would not hold my breath for their dividend to return so quickly. 

Other Reasons ZIM Stock Could Run in 2024

ZIM isn’t just about profits, they’re also committed to reducing their environmental footprint with fuel-efficient ships and green initiatives. In their latest earnings statement, ZIM had some exciting news. The company announced that they have executed a fleet renewal program that will begin integrating LNG-powered ships. By 2025, the company plans on having ⅓ of its fleet to be LNG-powered. 

By incorporating LNG-powered ships into their fleet, ZIM should see fuel costs come down over time. This is pivotal considering fuel is one of the biggest expenses for shipping companies. By cutting these costs, ZIM will be able to use that money in other needed areas. In addition to their LNG goal, ZIM aims to be carbon neutral by 2050.

If global shipping ramps back up again, in addition to ZIM’s new fleet renewal program, it could be the perfect storm for growth. If ZIM stock grows enough and the growth is sustainable, it is very possible they could resurrect the dividend. 

However, if the company were to resurrect its dividend less than two years after getting rid of it, it might send mixed signals. Will investors fall back into another dividend trap in 2024? Fool me once, shame on you. Fool me twice? 

It’s Different This Time: ZIM Stock Dividend Edition

If ZIM does decide to bring back its dividend in 2024, you can rest assured knowing the price will benefit in the short term. Whether or not it will be able to maintain its growth and dividend payout is another question. 

We are heading towards the end of another miniature shipping crisis, and ZIM could benefit from the resurgence. Just like the growth they saw post-pandemic. With over 350 ports in 100 countries and a fleet of over 400 vessels, they have the capability.

ZIM is also employing the use of AI software to help create more efficient routes and solve other logistical problems. This will undoubtedly help the company cut more costs and reinvest the savings back into its bottom line. Speaking of AI, since ZIM has cut its dividend, there are some AI stocks that pay dividends that you might want to research as well. All right, back to business.

So will it be different this time if ZIM stock rallies in 2024? Will the growth be sustainable? On paper, it seems that ZIM is optimizing performance. But on paper and in reality are two different stories. Only time will tell if it will be different this time for the ZIM stock dividend story in 2024. While I think ZIM stock could have a bullish 2024, I don’t think we will see the return of the ZIM stock dividend just yet. One thing is for sure, we will be eagerly watching. 

Final Say on the ZIM Stock Dividend for 2024

ZIM stock faces challenges in 2024, having suspended its dividend in 2023 amid global conflicts and shipping crises. Despite these hurdles, we remain bullish for 2024 as far as the stock price is concerned. The company, based in Israel, asserts that it will continue operations unaffected by the conflict which helps to inspire confidence. Knowing that 90% of their business is done outside of their home country helps even more.  

While ZIM experienced significant growth in 2021-2022, mirroring the pandemic-induced shipping industry surge, the recent shipping crisis could potentially set the stage for a similar rise in 2024. ZIM’s commitment to sustainability with a fleet renewal program, integrating LNG-powered ships by 2025, may contribute to future growth by cutting fuel costs. 

Nonetheless, any potential dividend resurgence might be more modest and not as swift as hoped. Investors should approach cautiously, considering the recent dividend suspension and assessing the sustainability of ZIM’s growth in 2024. The company’s utilization of AI software and over 350 ports globally positions it well, but only time will unveil the true story of ZIM stock’s dividend in the coming year.