Teekay Corp

Since the BDTI (Baltic Dirty Tanker Index) has fallen by 50% from the beginning of the year, crude tanker stock prices have also fallen.

Dorian will be registering for resale, under the Securities Act of 1933 as amended, all the Dorian shares that Scorpio Tankers (STNG) owns. Scorpio Tankers currently owns approximately 9.4 million shares, or 16.3%, of Dorian.

In October, NAP amended its existing management agreement with Navios Tankers Management. It extended the fleet’s fixed-fee period for commercial and technical management services.

August was the first time in 22 months that China has recorded a YoY increase in imports. Crude oil imports for China are now at a record high.

In Week 28, analysts made no target price revisions or recommendation changes for crude tanker companies.

Refinery margins have fallen throughout most of the world. US Gulf refinery margins for WTI crude lost more than $2 compared to last month’s level.

For the week ending October 3, 2014, total products supplied were 19 million barrels per day (or bpd)—compared to 18.6 million bpd in the first week of September.

DHT Holdings (DHT) was the best-performing stock among peers on a YTD basis.

A strong increase in tanker rates is allowing Navios Maritime Acquisition to secure attractive contract periods for its fleet of charters.

GasLog Partners plans to release its 2Q17 results before the market opens on July 27. The release will be followed by a conference call on the same day.

In many ways, China is the most important country for the crude oil tanker industry. In this series, we’ll take a close look at China’s March 2017 import-export data and manufacturing sector performance.

US products supplied for the week ended March 17, 2017, totaled 19,225 Mbpd (thousand barrels per day), 1% less than in the previous week.

While the VLCC data is positive, the picture for the crude tanker business remains mixed. This could portray a short-to-medium-term negative outlook.

The consensus 12-month target price for Navios Maritime Partners is $4.83, which implies a potential upside of 40.82% from its market price on July 12.

Nordic American Tankers’ revenue in 3Q16 fell to $71 million—compared to $88 million in 2Q16. Its revenue was 29% lower than its revenue in 3Q15.

The EIA reported that the US commercial crude oil inventory rose by 2.6 MMbbls (million barrels) to 487.4 MMbbls for the week ending December 25, 2015.

Consensus recommendations On January 13, 2017, Credit Suisse downgraded Navios Maritime Midstream Partners (NAP) to “neutral” from “outperform” and decreased the target price to $12 from $13. Only five analysts give recommendations on Navios Maritime Partners. According to Reuters, the consensus rating for the stock is 2.6, which means a “hold.” One analyst has given a […]

The third quarter wasn’t very good for tanker rates. In August 2016, the middle of the third quarter, tanker rates dropped to some of their lowest levels.

Euronav thinks that the rise in the orderbook is partly due to the Tier 3 legislation on nitrogen oxide emissions. The legislation is applicable from January 2016.

The time charter rates for one year on VLCCs (very large crude carriers) fell to $43,000 per day on November 25—compared to $45,500 per day the previous week.

For the third quarter of 2014, the charter hire expense increased $1.1 million to $32.9 million, from $31.9 million in the year ago quarter.

According to Weber’s report, VLCC rates for the route from the Arabian Gulf to China fell from $10,809 per day on August 18 to $8,747 per day on August 25.

China’s crude oil imports in March hit a new record. Its total crude oil imports came in at 39.0 million tons, compared to 31.8 million tons in February.

In week 12 of 2018, which ended on March 23, the BDTI rose from 635 to 656. In week 11, the index dropped by 18 points.

Crude oil production has gradually fallen since the beginning of 2016, especially on the non-OPEC (Organization of the Petroleum Exporting Countries) side.

Teekay LNG Partners (TGP) has a total fleet of 87 vessels, out of which 27 vessels are newbuilds under construction. The active fleet of 60 vessels consists of 29 LNG carriers, 21 LPG carriers, and eight conventional tankers.

On September 30, 2016, Euronav (EURN) had long-term debt of ~$1.0 billion. This increased from $952 million at the start of the year.

GasLog Partners (GLOP) plans to release its 1Q18 results before the market opens on April 27.

In June 2017, Morgan Stanley upgraded GasLog (GLOG) to “overweight” from “equal weight.”

Five-year-old VLCC prices remained consistent, at $75 million, with the previous month’s levels. Year-over-year prices increased by 36%. Ten-year-old VLCC prices stood unchanged at $48 million and increased by 41.2% year-over-year.

October’s increase is generally positive for the long-term prospects of tanker stocks like Frontline ltd. (FRO) or Nordic American Tanker Ltd. (NAT).

Continued from Part 3 The importance of capacity Capacity, in a commoditized industry like shipping, is an important metric that directly impacts companies’ top line, or revenue performance. When capacity grows faster than demand, competition will rise among individual shipping firms as they try to use idle ships and cover fixed costs. This will lower day […]

Tsako posted revenue of $109 million in 3Q16—9% lower than last quarter’s revenue of $120 million and 23% lower than $141 million recorded in 3Q15.

Western Digital reportedly shipped ~42.5 million HDD units in fiscal 4Q16—a significant YoY fall of ~12.5% over units shipped in fiscal 4Q15.

In week 44, many of the crude tanker stocks traded in the red. Only Frontline and Navios Maritime Midstream Partners traded in the green.

China’s (MCHI) auto sales for the first two months of 2017 were 8.8% higher than sales for the same period in 2016.

The US benchmark WTI crude oil futures contracts for December delivery fell by 2.9% on November 11, 2015. Crude oil prices hit lows seen in August.

In the first quarter, Teekay Tankers’ EBITDA fell to $80.9 million, from $83.9 million in the previous quarter.

The Nikkei India Manufacturing PMI for April 2017 matched its reading for the previous month.

Newbuild VLCC (very large crude carrier) prices rose in May 2017, and this is the first time we’ve seen a rise in prices this year.

After a steep dip to a four-month low in January, crude oil imports in February jumped, which was a good sign for crude tanker investors.

In September 2015, Euronav distributed an interim dividend of $0.62 per share. Euronav has stated that it is committed to distributing 80% of net income.

JAT Capital sold its position in SanDisk Corporation (SNDK) in 4Q14. The position had represented 1.2% of the fund’s third-quarter portfolio.

According to Reuters, the consensus rating for Höegh LNG Partners (HMLP) is 1.38, which means a “strong buy.”

Gathering and processing MLPs were the best performing MLPs in the first quarter of 2017. The subgroup rose 14.7%.

Why ship prices (value) matter Ship prices (values) are often good indicators of financial health in the shipping industry. When shipping demand grows more than the supply of ships, shipping companies place additional orders of ships, which drives up purchase prices. Additionally, when firms are able to charge higher prices for transporting goods across the […]

Semiconductor manufacturing is complex and involves design, fabrication, assembly, and testing. Building a fab requires investments of $3–4 billion.

The cash breakeven costs are the daily rates of Frontline’s (or FRO) vessels. They have to earn the rates to cover budgeted operating costs and dry dock, estimated interest expense, payable at hire, and corporate overhead costs.

In May 2017, the Markit China Manufacturing PMI was 51.2 (MCHI)—similar to the previous month.

Most of the crude tanker stocks rose in week 21. Euronav and DHT Holdings were the best performers in the sector.

In week 16, the BDTI was higher than the previous year’s level. On average, the index was 4% higher than the same period last year.

Continued from Part 3 The importance of capacity Capacity, in a commoditized industry like shipping, is an important metric that directly impacts companies’ top line, or revenue performance. When capacity grows faster than demand, competition will rise among individual shipping firms as they try to use idle ships and cover fixed costs. This will lower […]

Teekay’s acquisitions complement the company’s ship-to-ship transfer business and expand its presence in the US Gulf of Mexico.

US oil rig count is a leading indicator of US oil production and oil imports. Since 2008, a boom in US oil industry has negatively impacted demand for tankers (see Tankers will likely underperform dry bulk ships in 2013)— vessels that transport oil across ocean. Higher US oil production, due to application of technologies called […]

In week 14, the BDTI (Baltic Dirty Tanker Index) fell from 790 to 775. The BDTI tracks shipping rates for crude oil tankers on representative routes.

Teekay LNG Partners (TGP) was the best-performing stock in 2017 among the LNG carrier companies. TGP reported a year-to-date return of 36.6% on December 20, 2017.

CVR Partners (UAN) was the top MLP gainer last week, which ended on January 5, 2018. It rose 23.2%.

Crude tanker stocks have given mixed returns in 2017. Gener8 Maritime has been the best performer YTD, while Nordic American has been the worst.

Tanker stocks tied to oil prices Tanker stocks often move in tandem with oil prices in a demand-driven market. But because tanker companies also use oil to run their ships, a price increase in oil due to supply shocks (such as political disruptions in the Middle East) also affects tanker firms differently. To get a […]

Teekay LNG Partners (TGP) stock has risen 37.9% in the past year as of March 20, 2017.

DHT Holdings’ (DHT) YTD returns were 1.1% as of April 5, 2018. DHT Holdings is the only crude tanker company with a positive YTD return.

After a spectacular 2015, the crude tanker industry is going through a rough patch in 2016. All crude tanker stocks have given negative year-to-date returns.

The API crude oil inventory rose for the fourth consecutive week. The rising crude oil inventory will continue to put pressure on crude oil prices.

Even though industry tanker rates were strong compared to 1Q15, the company recorded negative growth of -7% in 2Q15 compared to 1Q15.

In August 2017, China’s auto sales rose 4.1% YoY (year-over-year). Its total vehicle sales rose 5.3% to 2.19 million in August.

Industry analysts suggest that investors should avoid Frontline because of the bankruptcy risk. Currently, the company is facing bankruptcy. This is led by the $190 million bond that’s due in April 2015.

Point72 reduced its position in Micron Technology. It sold 4,792,200 shares during 4Q14. The shares accounted for 0.28% of the fund’s total 4Q14 portfolio.

In week 9 of 2018, which ended on March 2, the BDTI rose from 646 to 669. In week 8, the index fell by three points.

The second-largest NAND supplier, Toshiba (TOSBF), recently put its NAND business up for sale to avoid bankruptcy.

Update to Shipping capacity growth drops but outpaces demand, negative for tanker stocks The importance of capacity In a highly commoditized industry, like the shipping industry, capacity is an important metric that directly impacts companies’ top line, or revenue performance. When capacity grows faster than demand, competition will rise among individual shipping firms as they try […]

At the onset of 4Q15, tanker rates started to climb as refineries completed their maintenance programs. The rate spike was especially lead by VLCCs.

In the first week of 2017, the number of VLCCs (very large crude carriers) in the world was 686. Halfway into 2017, the VLCC fleet has grown to 713.

The day after Euronav (EURN) announced its 3Q16 results on October 31, it announced that its agreed to purchase the 50% of the joint venture it does not own in the VLCC VK Eddie.

In week 39, the week ending September 29, the BDTI rose to 776 from 772. In week 38, the index rose by 28 points. It rose for the fifth consecutive week.

To get expertise in shale gas exploration, China has invested more than 20% of the total investments in US shale gas exploration.

The US benchmark WTI crude oil futures contracts for December delivery rose by 2.5% on November 16. Crude oil prices rose due to possible supply disruptions.

In order to assess the industry’s fundamental outlook, managers use the oil tanker orderbook. It’s an important yardstick. It includes the number of ships that have been ordered and the number of ships under construction. A rising orderbook usually suggests that oil tankers have a better expectation for future supply and demand dynamics.

The top three MLP gainers in 2017 were downstream MLPs Calumet Specialty Products Partners (CLMT), Alon USA Partners (ALDW), and CVR Refining (CVRR).

Tankships seeks to expand its fleet size through timely and selective acquisitions of additional secondhand modern tankers and the available optional vessels.

Kinder Morgan (KMI) decided to slash its quarterly dividend by 75% in the 2016 outlook it released few days ago.

On a year-to-date basis, GasLog Partners (GLOP) was the top-performing stock among the LNG carrier companies.

Continued from Why oil price is a key driver of tanker stocks The impact of China’s financial industry The financial industry is an essential part of any economy. Without a stable financial system—one that supplies liquidity to businesses and individuals and bridges the gap between savers and borrowers—an economy can’t function as efficiently and productively […]

VLCC rates (very large crude carrier) for the benchmark route Gulf to Japan rose from $49,400 per day last month to $112,100 per day for the week ending October 2, 2015.

Teekay Offshore Partners (TOO) was the top MLP loser in the week ending February 2. The partnership fell 13.5% last week.

According to the U.S. Energy Information Administration (or EIA), for the week ending September 12, 2014, U.S. crude oil imports from Canada hit a record high of 2.99 million barrels per day (or bpd). This was a 20% increase from the same period last year. Meanwhile, the four-week average on September 12 was 2.93 million bpd.

Looking ahead to 2015, Teekay Tankers Ltd. (TNK) forecasts 2.0% net global tanker fleet growth with major contribution from the product tanker sector. There is a negative fleet growth estimate for the Suezmax and uncoated Aframax sectors.

Wall Street analysts expect revenues of $75.39 million for GasLog Partners (GLOP) in 4Q17—compared to $73.4 million in the previous quarter.

In September 2016, HP (HPQ) announced its intention to acquire Samsung’s (SSNLF) Printing business for $1.1 billion.

In its first-quarter conference call, Teekay Tankers gave insights on the crude tanker market.

Analysts and money managers follow the Baltic Dirty Tanker Index (or BDTI). They follow the Index to assess the crude oil shipping industry’s revenue and earnings potential. The Baltic Dirty Tanker Index decreased to 699 on August 29, 2014. It was 826 at the beginning of the month.

The crude tanker industry is highly fragmented. The total world fleet of VLCCs (very large crude carriers) stood at 640 at the end of 2015.

Since the beginning of 2018, the BDTI (Baltic Dirty Tanker Index) has fluctuated between 628 and 781. The year started out with the BDTI at 700.

There are several things Frontline can do to pay its maturing $190 million bonds. But activities such as selling assets or raising additional capital would likely put Frontline behind its peers.

WTI crude oil for May delivery trading in NYMEX gained marginally by 0.73% in yesterday’s trade. WTI oil prices closed at $50.79 per barrel on April 9, 2015.

The BDTI can be used to assess the crude tanker industry. In week 29 (week ending July 20), the BDTI fell from 744 to 723.

Teekay Offshore Partners (TOO) was the only MLP to see a rating update last week. Let’s take a closer look.

December WTI crude oil futures contracts trading in NYMEX fell by 2.6% on November 17. Crude oil prices resumed a downward trend.

China’s crude oil import: The most important factor An indicator that has a first-degree (direct) influence on tanker rates is China’s crude oil import volume. When import volume rises, more tankers will be in use, which pushes up shipping rates. Conversely, lower import volume means an increased number of idled ships, which leads to increased […]

According to preliminary weekly US data, total crude exports have averaged ~0.77 MMbpd in 2017—substantially higher than the same period last year.

The consensus 12-month target price for Teekay Tankers is $1.69, which implies a potential upside of 43.2% from its July 11 market price.