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Gauging Tsakos Energy’s Estimated Revenue Fall for 2Q17

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Revenue estimates

For 2Q17, Wall Street analysts estimate that Tsakos Energy Navigation (TNP) will see revenues of $109.8 million. This compares with $138 million in the previous quarter and $119 million in 2Q16 and would be an 8.3% fall YoY (year-over-year) but a 21% fall quarter-over-quarter.

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Revenue sources

Tsakos earns its revenue through operating crude tankers including VLCCs (very large crude carriers), Suezmaxes, Aframax, and product tankers. The company operates its vessels in the spot market as well as in time charter market.

Long-term estimates

For 3Q17, analysts expect TNP’s revenues to be $110 million. But so far in 2017—especially in the second quarter—the crude tanker industry has faced headwinds. We saw a free fall in tanker rates due to an increase in the supply of crude tankers, and rates have continued to drop in the third quarter.

Due to weak spot rates, Tsakos’s revenues are expected to take a hit for the rest of 2017. However, as Tsakos has many of its vessels on long-term contracts, the weak market will likely have less impact on Tsakos’ revenue.

Analysts estimate that TNP’s fiscal 2017 revenues will be $453 million—5.9% lower than 2016’s revenue of $481.7 million. Tsakos’ peers with comparatively larger fleets in the spot market could very well experience greater declines in 2017 revenues.

The following is a peer breakdown:

  • Analysts estimate that Frontline’s (FRO) 2017 revenues will be $522 million—30.7% lower than 2016’s revenue.
  • Analysts estimate that Nordic American Tankers’ (NAT) 2017 revenues will be $190 million—19.6% lower YoY.
  • Analysts estimate that DHT Holdings’ (DHT) 2017 revenues will be $265 million—8.7% lower YoY.
  • Analysts estimate that Euronav’s (EURN) 2017 revenues will be $501 million—26.8% lower YoY.
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