Shipping analysts are united in expectation of a new round of fleet expansion at tanker owner Euronav.

New York-listed Euronav has bought 26 VLCCs since the start of 2014, when it picked up the Maersk fleet for $980m.

And after efforts to boost its balance sheet during the first weeks of 2017 and a more downbeat market view, analysts tracking the company believe more buys are on the cards.

“The combination of $597m in liquidity, the CEO talking the tanker market down, and the 30% decline in asset values since the 2015 peak lead us to believe Euronav is positioning to make counter-cyclical investments,” said Nicolay Dyvik, Petter Haugen and Jorgen Lian of DNB Markets.

Euronav’s firepower includes $206.6m in cash at a time when it is ready for the worst and preparing for the best. As Andreas Wikborg and Erik Nikolai Stavseth of Arctic Securities put it, Euronav is “sitting on the fence with pockets full of cash”.

“With low leverage, a bolstered liquidity position, access to highly attractive funding and an ocean full of cheap high-quality tonnage, we find it hard to imagine Euronav not looking back at 2017 as a year of growth and well time acquisitions,” the wrote in a report today.

'Fantastic bargains'

Euronav chief executive Paddy Rodgers told Marine Money in London this week: “For the rest of the year this might be the time you have to suck it up, accept the lower rates and go shopping. Because there should be some fantastic bargains.”

During the owner’s fourth quarter conference call on Thursday, Rodgers said when the company felt rates have bottomed out it would “think very seriously about fleet expansion or growth”.

“I would hope that anybody who was looking at us in a years' time would be looking at us and saying there is a company that's used what we might call increased availability of funds very well and yet remains extremely robust, liquid and with a long-term future," Rodgers said.

“So keeping everything balanced, we've always said growth at reasonable price and a balanced outlook, resilient, strong and exposed to the upside. So if we can say we still have all of those things in the years' time I'll be well happy.”

Consolidation candidate

A $186m sale-sale-and-leaseback and the arrival of a new revolving credit facility worth $410m have contributed to what Fotis Giannakoulis of Morgan Stanley termed “significant acquisition capacity” and Mike Webber of Wells Fargo branded “significant optionality”.

Magnus Fyhr of Seaport Global said: “With low financial leverage of 31.8%, $206.7m of cash, and over $390m available on the revolver, we believe Euronav is well positioned to weather multiple headwinds in 2017 and pursue potential consolidation opportunities.”

Jon Chappell of Evercore ISI was more specific, noting firepower of $600m could fund nine or 10 five-year-old VLCCs at current price levels.

“It sounds as if management will remain cautious for now as it lacks immediate transparency on asset price direction (and it will also remain on the sidelines of its share buyback authorization), but would look to move quickly if it believes asset values have bottomed,” he said.

Euronav yesterday reported a fourth quarter adjusted profit of $13.5m, beating the $13m consensus.