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Teekay Tankers: Analysts Recommend a ‘Hold’

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Jun. 1 2018, Updated 2:30 p.m. ET

Analysts’ recommendations

Out of the eight analysts that gave recommendations on Teekay Tankers (TNK), one analyst recommended a “strong buy,” two recommended a “buy,” four recommended a “hold,” and one recommended a “sell.” None of the analysts recommended a “strong sell.”

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Consensus rating

The consensus rating for Teekay Tankers is 2.63, which means a “hold.” The following are the consensus ratings for other crude tanker companies on a scale of one (strong buy) to five (strong sell):

  • DHT Holdings (DHT): 2.21, which means a “buy”
  • Navios Maritime Midstream Partners (NAP): three, which means a “hold”
  • Nordic American Tankers (NAT): 3.57, which means a “sell”
  • Tsakos Energy Navigation (TNP): two, which means a “buy”

Target price

The consensus 12-month target price for Teekay Tankers is $1.61, which implies a potential upside of 61% from the market price of $1 on May 29.

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Target price revision

In May, Evercore reduced Teekay Tankers’ target price to $2 from $2.5 and maintained an “outperform” rating on the stock.

First-quarter highlights

Teekay Tankers reported a GAAP net loss of $19.2 million or $0.07 per share in the first quarter. In April, Teekay Tankers signed a term sheet for a sale-leaseback financing transaction related to seven modern conventional tankers. The transaction is expected to increase Teekay Tankers’ liquidity by ~$36 million. Teekay Tankers eliminated the minimum quarterly dividend of $0.03 per share to maintain its balance sheet strength during the cyclical downturn. In the first quarter, Teekay Tankers reported revenues and an EBITDA of $168.4 million and $21.01 million—67% higher and 45% lower year-over-year.

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