Euronav NV - Well-positioned to cash in on surge in vessel earnings
Higher dividends – an additional incentive to invest in EuronavEuronav NV (NYSE:EURN) instituted a new dividend policy in January 2020, which stipulates that the company will pay 80% of the net income to shareholders in the form of quarterly cash dividends. This number will include a minimum fixed component of USD 0.03 per share. The dividend calculation will exclude capital gains, but will include capital losses during the quarter. The company has already announced dividend payment of USD 0.81 per share for 1Q20 which is substantially higher than the annual dividend of USD 0.35 per share for 2019. Elevated vessel earnings on the back of the firm tanker market due to the coronavirus (COVID-19) outbreak will enhance the topline and profitability of the company. We estimate an annual dividend payout of ~USD 2.14 per share for 2020 and believe prospects of a higher dividend in addition to the potential upside in the company’s stock price will provide an incentive to invest in EURN.
Euronav is a provider of maritime shipping and offshore services engaged primarily in the transportation and storage of crude oil. As of Apr. 4, 2017, Co. owned and operated a modern fleet of 55 vessels (including four chartered-in vessels) with an aggregate carrying capacity of approximately 13.7 million deadweight tons, or dwt, consisting of 31 very large crude carriers, one ultra large crude carrier, 21 Suezmax vessels, and two floating, storage and offloading vessels. Co. has two operating segments: the operation of crude oil tankers on the international markets (tankers) and the floating production, storage and offloading operations.
Drewry, since 1970, has been providing research and advisory services on the global Maritime and Shipping industries and has established itself as a firm with long history of credibility and expertise on various aspects of the maritime industry. Leveraging this in-depth market knowledge and understanding, we have extended our offering to deliver a unique, independent investment research service on globally listed companies operating in the maritime industry. Under the brand Drewry Maritime Equity Research and in accordance with the FCA, DMER led by Rahul Kapoor and his team, offers fundamental analysis on listed companies. DMER analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. By combining these market-leading resources with seasoned sector expertise and commercial awareness, we are able to offer a highly differentiated and comprehensive investment research service to prospective investors in listed maritime companies. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.
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