GENCO SHIPPING & TRADING LTD

Where It Passes

Where It Falls Short

• Profitability6% pass✓ 6✗ 29▾

  15 of 16 flag GNK's profitability — Graham, Buffett, Lynch +12 more

  Net income / market capitalization+6.97%; #1184/6340 (top 18.7%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive EPS (10 years)11/22 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)11/22 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)8.5%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)2.2% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$68.7M

  ✗BuffettPositive and growing

  Earnings Variance (10-yr CoV)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE8.9%

  ✗Lynch> 15%

  EBIT / Enterprise Value7.0%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=7.0%, ROC=833.4%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Net Income / Total Assets-0.38%

  ✗PiotroskiROA > 0

  ROA Change YoY7.23% -> -0.38% (delta: -7.61%)

  ✗PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=2.80%, ROA=-0.38%

  ✓PiotroskiCFO/Assets > ROA

  Gross Margin Change YoY

  ✗PiotroskiImproved YoY

  Pre-Tax Income / Revenue

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity8.9%

  ✗Dreman> 12%

  Margin of SafetyP/B=1.3x

  ✓PabraiP/B < 1.5 or P/E < 15

  Return on Equity2.1% (3-yr avg)

  ✗AkreROE > 20% (3-year avg)

  Discount to Intrinsic Value-287.3% (IV=$6.75 vs Price=$26.14)

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency11/21 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue19.2%

  ✓Ackman>= 15%

  Net Income / Shareholders Equity8.9%

  ✗Ackman>= 15%

  5-Year EPS CAGR-25.7% CAGR over 3 years

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend-1.5% (2023) -> 2.2% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendrevenue flat/down, operating margin -1.5% -> 2.2%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  Gross profit / total assets

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity+8.89%; #1972/5226 (top 37.7%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0677; #2967/5884 (top 50.4%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-25.7% over 3 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years3/10 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Valuation8% pass✓ 6✗ 22▾

  12 of 13 flag GNK's valuation — Graham, Lynch, Greenblatt +9 more

  Price / Book Value per Share1.3x

  ✗Dreman< 1.2x✓Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Net income / market capitalization+6.97%; #1184/6340 (top 18.7%)

  ✓AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Price / 3-yr avg EPS58.1x

  ✗Graham<= 15x

  Price-to-Book Ratio1.3x

  ✓Graham<= 1.5x

  P/E x P/B73.40

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  EBIT / Enterprise Value7.0%

  ✗Greenblatt> 10%

  Earnings Yield + ROC AssessmentEY=7.0%, ROC=833.4%

  ✗GreenblattBoth EY > 10% and ROC > 25%

  Price / EPS

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)35.5x

  ✗Dreman< 8x

  Valuation ReasonablenessOE Yield=6.1%

  ✓MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldFCF Yield=2.5%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/B=1.3x

  ✓MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic Value-287.3% (IV=$6.75 vs Price=$26.14)

  ✗Marks>= 20% below intrinsic value

  Price / FCF per Share39.4x

  ✗Ackman<= 25

  Price vs. Trailing Low202% of trailing low ($12.96)

  ✗Templeton<= 120% of trailing low (certified split-adjusted live window)

  Positive book equity / market capitalization+0.7839; #1972/6449 (top 30.6%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Price / Tangible Book Value per Share1.26x

  ✗SchlossP/TBV <= 1.00x (app cutoff)

  Book Value per Share Change+16.1%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.4499; #2774/5247 (top 52.9%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization+11.31%; #629/4519 (top 13.9%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date+12.19%; #1741/6202 (top 28.1%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Growth13% pass✓ 2✗ 11▾

  7 of 8 flag GNK's growth — Graham, Lynch, Dreman +4 more

  EPS Growth (3-yr avg, 10-yr window)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  Inventory Growth vs Revenue GrowthInv: 34.5% vs Rev: 54.7%

  ✓LynchInventory growth < Revenue growth

  EPS Growth Direction

  ✗DremanPositive over recent years

  EPS CAGR

  ✗Dreman> 5% annualized

  Positive Net Income Frequency11/21 years positive

  ✓MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth-19.1%

  ✗Ackman>= 5%

  Positive EPS Growth Frequency2/5 years with positive EPS growth

  ✗AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR-25.7% CAGR over 3 years

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendrevenue flat/down, operating margin -1.5% -> 2.2%

  ✗SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR-0.8%

  ✗SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-25.7% over 3 years

  ✗Neff7%-20% annualized
• Valuation models13% pass✓ 1✗ 7▾

  Models split on GNK at $26.14 — fair values range $5.39–$27.96

  Buffett fair value$18.74

  ✗Buffett-39.5% margin vs $26.14

  Greenblatt fair value$5.39

  ✗Greenblatt-385.0% margin vs $26.14

  Dreman fair value$6.75

  ✗Dreman-287.3% margin vs $26.14

  Munger fair value$11.02

  ✗Munger-137.2% margin vs $26.14

  Pabrai fair value$14.75

  ✗Pabrai-77.2% margin vs $26.14

  Akre fair value$13.53

  ✗Akre-93.2% margin vs $26.14

  Ackman fair value$5.48

  ✗Ackman-377.0% margin vs $26.14

  Templeton fair value$27.96

  ✓Templeton+6.5% margin vs $26.14
• Verdicts17% pass✓ 2✗ 10▾

  Split decision: 10 FAIL · 5 NEUTRAL · 1 PASS

  Overall verdict

  ✗GrahamFAIL (3/9)✗BuffettFAIL (0/9)✗LynchFAIL (2/7)✓GreenblattRank #135✗PiotroskiFAIL (F-Score 2)✗DremanFAIL (4/11)•MungerNEUTRAL (3/4)✗PabraiFAIL (1/3)✗AkreFAIL (1/6)•MarksNEUTRAL (4/5)✓AckmanPASS (4/9)•TempletonNEUTRAL (5/8)✗SleepFAIL (2/6)•AsnessNEUTRAL (Not ranked)✗NeffFAIL (2/6)•SchlossNEUTRAL (4/7)✗OshaughnessyFAIL (Rank #361/963 (Top 37.5%))
• Efficiency38% pass✓ 3✗ 8▾

  5 of 8 flag GNK's efficiency — Buffett, Piotroski, Munger +2 more

  Current Ratio2.58

  ✓Graham>= 2.0

  ROIC (3-5 yr avg)7.0%

  ✗Buffett> 10%

  ROIC - WACC-3.0%

  ✗BuffettPositive (WACC = 10%)

  EBIT / (NWC + Net Fixed Assets)833.4%

  ✓Greenblatt> 25%

  Current Ratio Change YoY2.41 -> 2.39

  ✗PiotroskiIncreased YoY

  Revenue / Total Assets Change YoY0.40x -> 0.30x

  ✗PiotroskiImproved YoY

  Current Assets / Current Liabilities2.58

  ✓Dreman> 1.5

  Return on Invested Capital6.2%

  ✗Munger> 15%

  ROIC (high and growing)FY2023: ROIC=-0.4%; FY2024: ROIC=6.8%; FY2025: ROIC=0.5%

  ✗AkreLatest 3 consecutive FYs: ROIC > 15% in each

  Reinvestment Rate x ROIC0.0% (RR=0% x ROIC=6.2%)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROIC (5-year)1/5 years above 12% (latest 0.5%)

  ✗SleepROIC > 12% in a majority of years
• Debt & Leverage50% pass✓ 8✗ 7▾

  6 of 12 pass — Graham, Buffett, Lynch +3 more object

  Debt Levels0.41

  ✓MungerDebt/Equity < 0.5✗AkreDebt/Equity < 0.3

  LT Debt vs Net Current AssetsLT Debt $370.2M vs NCA $98.8M

  ✗GrahamLT Debt <= Net Current Assets

  Debt/Equity & Interest CoverageD/E: 0.41, IC: 4.8x

  ✗BuffettD/E < 0.5 AND Interest Coverage > 5x

  Total Debt / Equity0.41

  ✗Lynch< 0.33

  Cash - Long-term Debt$-275.6M

  ✗LynchPositive preferred

  LT Debt / Total Assets Change7.78% -> 16.61%

  ✗PiotroskiDecreased YoY

  Current Assets / Current Liabilities2.58

  ✓Dreman> 1.5✓SchlossCurrent ratio >= 1.50x (app cutoff)

  Total Debt / Shareholders' Equity0.41

  ✓Dreman< 0.8✓Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✓SchlossD/E < 1.00x

  Interest Coverage & Debt/EBITDAIC=4.8x, D/EBITDA=2.0x

  ✓MarksInterest Coverage > 3x; Debt/EBITDA < 4x

  Total Debt / Shareholders Equity0.41

  ✓Ackman<= 1.0

  Negative debt-to-equity (higher means less debt)-0.4145; #2277/4210 (top 54.1%)

  ✗AsnessTop 30% of eligible cross-section
• Cash Flow50% pass✓ 7✗ 5▾

  5 of 10 pass — Buffett, Dreman, Pabrai +2 more object

  Free Cash Flow Proxy$68.7M

  ✗BuffettPositive and growing

  FCF Positive and Growing$128.9M

  ✓LynchPositive and growing

  Operating Cash Flow$31.9M

  ✓PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=2.80%, ROA=-0.38%

  ✓PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)35.5x

  ✗Dreman< 8x

  P/E or FCF YieldFCF Yield=2.5%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive10/14 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap11.4%

  ✓Ackman>= 4%

  Price / FCF per Share39.4x

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency17/21 years positive

  ✓SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$128.9M

  ✓Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization+11.31%; #629/4519 (top 13.9%)

  ✗OshaughnessyTop 10% of eligible cross-section