Norwegian chemical tanker owner Stolt-Nielsen is safe from product carrier competition, with rates expected to rise for the rest of 2024.
That is the forecast of Fearnley Securities ahead of the Oslo-listed group’s third-quarter results on Wednesday.
The investment bank predicts Ebitda of $206m for the July to September period, against the analyst consensus of $213m.
Its analysts are estimating an uptick in chemical tanker Ebitda to $156m, driven by a 2% quarter-on-quarter rise in time charter equivalent rates.
This will be offset by lower figures from the terminal operations, with Ebitda forecast at $30m, due to the company freeing tank space to accommodate new business, analysts Fredrik Dybwad and Nils Thommesen said.
Ebitda from tank containers and Stolt Sea Farm will remain stable, Fearnley believes.
Stolt-Nielsen will declare an annual dividend in November.
The analysts are expecting it to come in at $3.25 per share.
They also predict a continued increase in earnings driven by TCE numbers rising by 3% in the final three months.
Clean rates enough to deter swing trade
“Further, market outlook will be in focus with fears of a weaker product tanker market over the summer potentially spilling over to chemical tankers,” Dybwad and Thommesen said.
“However, on the latter, we believe current MR rates are sufficient to keep the swing tonnage in the product trade.”
Stolt-Nielsen is trading at 80% of net asset value, according to Fearnley, with a 9% dividend yield.
The investment bank has a “buy” rating on the stock.
In July, shares slid after the group posted a weaker than forecast second-quarter performance.
Operating profit was $137m, up from $10.1m a year ago, but this was below the $139m consensus.
Net profit of $89.7m also missed the $104.5m forecast by analysts, according to data from Norne Securities.
