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Week 15: Nordic American Tankers Fell but Tanker Stocks Rose

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Downgrade

In week 15 from April 15 to April 17, 2016, Wall Street analysts only downgraded one crude tanker company. Drewry Financial Services downgraded Nordic American Tankers (NAT) from “attractive” to “neutral.” It reduced the target price to $15.8 from $16.8.

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Target price cut

In week 15, Danske Bank reduced the 12-month target price on Frontline (FRO) to $12.5 from $13.38. It reduced Teekay Tankers’ (TNK) 12-month target price to $3.8 from $4.5.

Target price increase

In week 15, Danske Bank increased Euronav’s target price to $12.6 from $11.7. Also, UBS increased General Maritime’s (GNRT) 12-month target price to $11 from $10.5.

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Stock performance

Week 15 was a good week for crude tanker investors. All of the crude tanker stocks ended in positive territory. Below are the stock returns on April 15, 2016, compared to their prices a week ago.

  • Teekay Tankers rose by 6%.
  • Tsakos Energy Navigation (TNP), DHT Holdings (DHT), and Nordic American Tankers rose by 3% each.
  • Frontline rose by 1%.
  • Navios Maritime Midstream Partners (NAP) rose by 9%
  • Euronav (EURN) rose by 10%.

Shipping companies account for 19.7% of the Guggenheim Shipping ETF (SEA). SEA rose 7% in week 15. Investors who are interested in broader exposure to the industrials sector can invest in the SPDR Dow Jones Industrial Average ETF (DIA).

Series focus

We looked at changes in analysts’ recommendations and at tanker stocks’ performance in week 15. In the next part, we’ll see how tanker rates changed during week 15. In part three of this series, we’ll look at the cost side of the tanker industry. We’ll discuss rebunker fuel costs.

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