Analyst Doug Mavrinac launched coverage of the shipowner with a $20 per share target price, well above its $14 per share IPO level.
In a note to clients Mavrinac explained the positive view was influenced by a strengthening market, Iranian production adding volumes to the market, improving tonne mile demand and higher fleet efficiency.
Jefferies, an underwriter on its IPO, believes Gener8 will turn a $47.08m loss in 2014 into a $139.67m gain in 2015.
Its bottom line will shoot up further to $204.53m in 2016, the analyst believes.
Gener8 went public with 25 tankers on the water, including seven VLCCs.
Its 21 eco newbuildings will bring daily savings of $6,300 per day based on bunker prices of $350 per tonne, Mavrinac says.
This works out at around $48m per year, according to Jefferies’s sums.
“Furthermore, if/when fuel prices rise from current levels, the savings are only likely to increase with the average bunker fuel price over the past five years of $615 per ton translating to an annual savings of ~$83m per year,” he said.
The last of the newbuildings will arrive in early 2017.
