ASC - Ardmore Shipping: A Bet On The MR Tanker Market For Income-Minded Investors

2024-04-03 12:10:47 ET

Summary

• MR tankers market is expected to remain strong in 2024 due to limited vessel supply and growing tonne-mile demand for petrol products.
• Ardmore Shipping is a niche bet on the growing deficit of MR tankers. The company has an MR-focused fleet with an average age of 9.6 years.
• FY23 revenue and net income declined despite the strong day rates. However, ASC delivered strong cash flow growth YoY. ASC pays dividends with a 5.43% yield at a 33% payout.
• The company maintains a conservative balance sheet with 16.9% total liabilities/total assets.
• Compared to its peers, ASC trades at a reasonable discount. The company has a 94% P/NAV and 13% gross LTV.

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