Analysts’ Recommendations before Frontline’s 3Q17 Results

We already discussed what analysts expect for Frontline’s (FRO) revenue and EBITDA in 3Q17 and fiscal 2017. Now, we’ll discuss what analysts recommend for Frontline and other crude (DBO) tanker companies.

According to Reuters, analysts’ consensus rating for Frontline is a three, which means “hold.” The following are the consensus ratings for other crude tanker companies:

• Gener8 Maritime (GNRT) – two, which means “buy.”
• Euronav (EURN) – 2.17, which means “buy.”
• Nordic American Tankers (NAT) – 3.67, which means “sell.”
• Teekay Tankers (TNK) – 2.91, which means “hold.”

According to Reuters, five analysts gave recommendations on Frontline. None of the analysts gave the company a “strong buy,” but one analyst rated it as a “buy.” Three analysts, or 60%, gave Frontline a “hold” recommendation, one analyst rated it as a “sell,” and none of the analysts rated it as a “strong sell.”

Since the beginning of 2017, only one analyst has revised the recommendation on Frontline. In July 2017, Evercore downgraded Frontline to “underperform” from “inline.”

The 12-month consensus target price for Frontline is $6.2. Compared to the current market price of $5.79 on November 15, the target price implies a potential upside of 7.5%.

In October, two analysts revised Frontline’s target price. On October 30, 2017, Wells Fargo reduced Frontline’s target price to $6 from $6.5. On October 25, 2017, Evercore raised Frontline’s target price to $5.5 from $4.