Navigator Holdings - the preferred player in LPG shipping
- NVGS to benefit from a steady Handysize market
- Evolving ethylene trade in the petchem market
- Stable earnings in 4Q15
- Accounting adjustments, but no impact on cash flow
- NVGS ensuring revenue visibility, no plans to defer vessel deliveries
We remain optimistic on NVGS and maintain our Attractive rating with a fair value of USD 21.5 per share based on net asset value approach. The company is expected to deliver stable earnings ahead considering it generates revenue by carrying a diversified mix of cargo rather than being dependent on transporting propane/butane. Moreover, the company has a strong balance sheet, and is trading at reasonable valuations. The stock is available at FY16 EV/EBITDA of 7.5x compared with its long-term average of 9.1x. We have put all gas shipping companies in the Medium risk category because of extreme volatility in the energy markets. The key downside risk is lower-than-expected spot rates, and continued turbulence in oil prices.
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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