Drewry Maritime Equity Research - Rally in product tanker stocks to be short-lived

Report

Santosh Gupta

Rally in product tanker stocks to be short-lived

Product tanker stocks have climbed in the last month (23 October to 25 November) mainly driven by a rally in the global equity markets and
seasonal strengthening of product tanker freight rates. DMFR product tanker index rose 16.9% since 30 October, while S&P 500 increased
11% and Baltic clean tanker index grew 19.2% in the same period. After record high earnings in 2Q20, company earnings dipped in 3Q20
as spot shipping rates declined. We delve deeper to find whether fundamentals support the recent rally in product tanker stocks.

Given our expectations of a weaker product tanker market in 2021 and bearish medium-term outlook, we believe the ongoing rally in
product tanker stocks is unlikely to last. In 1H20, product tanker owners saw a massive jump in profits, but we project earnings to be
lower in 4Q20 and in 2021.

07/12/2020 5 EN

Provider

Drewry Maritime Equity Research

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.

See profile

Analysts

Santosh Gupta

Other Reports from Drewry Maritime Equity Research

Ankush Kathuria

Ankush Kathuria

Westports_Result Update 3Q22

After massively underperforming the Drewry Port Equity Index in 2021, Westport’s stock price moved in tandem with the broader equity index in 2022. The stock slumped 11.2%, in line with the 12.2% decline recorded by the Drewry’s sectorial index. At the current EV/EBITDA valuation, the company trades at a premium of 18.0% when compared with Drewry Port Equity Index, but is at a 16.1% discount from its five-year historical average. Our fair value estimate of MYR 4.08 provides an upside of 8.9% compared to the current stock price.

January 18, 2023 January 18, 2023 1 EN

Nikesh Shukla

Nikesh Shukla

Star Bulk Carriers - Changing our view to Neutral as market gets challenging in 2023

Stock prices of dry bulk shipping companies constituting the Drewry Dry Bulk Equity Index came under pressure in the beginning of 2022 after a great performance in 2021, but market disruptions in the aftermath of the Russia-Ukraine conflict led to a surge in demand and earnings of dry bulk carriers. As a result, the index as well as the stock price of Star Bulk Carriers (SBLK) rose from February to May, but both declined thereafter due to demand concerns in China in the aftermath of Covid restrictions. With seasonal demand kicking in in July, the index as well as the SBLK stock started trendin...

January 12, 2023 January 12, 2023 1 EN

Nikesh Shukla

Nikesh Shukla

Nordic American Tankers to benefit from improved supply-demand fundamentals of mid-sized tankers

The crude tanker market was largely on an uptrend throughout the year barring the initial weakness amid the Omicron-led demand concerns and high oil prices. We expected the tanker market to recover gradually in 2022, but the changes in trade patterns as a result of Europe’s move to reduce energy dependence on Russia in the aftermath of the Russia-Ukraine conflict accelerated the pace of recovery in the crude tanker market. The diversion of Russian barrels on long-haul routes to Asia and increased European imports from the Middle East and trans-Atlantic routes led to a surge in demand and spot ...

January 3, 2023 January 3, 2023 1 EN

Sign-up for free to access full reports immediately

Email Address*

Choose Password* ( 6 or more characters )

Due to regulatory restrictions regarding the distribution of financial research, this report is restricted to a specific region or investor type. Get access to exclusive reports by answering the questions below.

Select your country*

Get financial insights straight to your inbox

By clicking "register" you accept the Terms and Conditions & Privacy Policy

Already on ResearchPool?

Almost there...

Are you a professional investor?

Select your country

REGISTER

Create a free ResearchPool account to access full reports, get a personalised dashboard and follow providers or companies

In order to access this report please create an account.

LOGIN

Rally in product tanker stocks to be short-lived

Westports_Result Update 3Q22

Star Bulk Carriers - Changing our view to Neutral as market gets challenging in 2023

Nordic American Tankers to benefit from improved supply-demand fundamentals of mid-sized tankers

Create a free ResearchPool account to access full reports, get a personalised dashboard and follow providers or companies

Sign-up for free to access full reports immediately

ResearchPool Subscriptions

Get the most out of your insights

Why subscribe?

How to subscribe

ResearchPool Subscriptions

This report is only available to subscribers

Why subscribe?

How to subscribe