In this part we’ll see how analysts changed their recommendations in week seven of 2016. We’ll also discuss how different crude tanker stocks performed in this week. Some of the changes in analysts’ recommendations from February 26, 2016, to March 4, 2016, are as follows:
- UBS pulled down its target 12-month price on many crude (DBO) tanker companies. It decreased its target on Tsakos Energy Navigation (TNP) to $8 from $10. It decreased Euronav (EURN) from $16 to $12, Teekay Tankers (TNK) from $10 to $4, and DHT Holdings (DHT) from $10 to $7.
- Nordea changed its “buy” rating to “hold” for Frontline (FRO). It also decreased its 12-month target price to $9.23 from $14.55.
- Pareto increased its six-month target price for Frontline to $13.43 from $13.26.
- DNB decreased its target price from $14.96 to $13.15 for Frontline.
- Clarksons Platou Services upgraded Frontline to “buy” from “hold” with a target price of $10.65.
For the week ending on March 4, 2016, most of the crude tanker stocks closed and gave a positive weekly return expectation. Teekay Tankers fell by 2% and Nordic American Tankers (NAT) fell by 1%. The returns for other crude tanker stocks are as follows:
- General Maritime (GNRT) and Tsakos Energy Navigation rose by 10%
- Frontline rose by 9%
- Navios Maritime Midstream Partners (NAP) rose by 16%
- DHT Holdings rose by 3%
- Euronav rose by 7%
Shipping companies account for 19.7% of the Guggenheim Shipping ETF (SEA). SEA rose by 10% for the same period. Investors who are interested in broader exposure to the industrials sector can invest in the SPDR Dow Jones Industrial Average ETF (DIA).
After looking at changes in analysts’ recommendations and stock performance for week nine, in the rest of this series, we’ll see how tanker rates moved this week. We’ll also discuss what investors can expect from week ten. We’ll take a look at the cost side of the tanker industry—the bunker fuel cost and the tanker industry’s valuation.