Despite its quarterly loss, two analysts are sticking with their highest ratings for Ardmore Shipping.
Evercore's Jonathan Chappell said the New York-listed product tanker owner has plenty of room to raise liquidity by refinancing ships, while Randy Giveans at Jefferies applauded the company's decision to charter in a 2009-built MR.
Chappell maintained an outperform rating with a target price of $6, while Giveans kept his buy rating with a $6.50 target.
In a note, Chappell said Ardmore had 11 more vessels it could refinance after hashing out deals for the 49,900-dwt Ardmore Seawolf and Ardmore Seahawk (both built 2015) freeing up $15.5m.
"[Ardmore] has the ability to raise proceeds from straight refinancings, rather than succumbing to more desperate dilutive measures if the product tanker recovery continues to shift to the right," he wrote.
Giveans said chartering in the vessel was a "vote of confidence" that the tanker market would improve, having suffered weak rates due to low demand.
He said the company was trading at a 45% discount to net asset value, pitching its current share price — which closed at $3.39 on Tuesday — as an attractive entry point for investors.
"Rates will likely remain under pressure in the coming weeks during the seasonally-slow summer period before increasing into the fall and further into 2022," Giveans said.
Chappell and Giveans' notes come after Ardmore posted a $7.6m adjusted loss for the three months ending on 30 June.
In the company's earnings release, chief executive Anthony Gurnee said the current weakness in rates would persist throughout August, before "markedly" improving during the rest of the year.
