FRO - Frontline's Aggressive Acquisition Strategy Pays Off Amid Global Disruptions
2024-06-03 08:53:00 ET
Summary
- Frontline reported strong earnings and distributions, indicating a positive outlook for the company.
- The company's fleet consists of VLCCs, Suezmaxes, and LR2 tankers, with a focus on fuel efficiency and scrubber-fitted vessels.
- The war in Ukraine and disruptions in the Suez Canal are expected to continue to impact rates.
- Global orderbook is relatively low and shipyard capacity constrained.
Frontline ( FRO ) reported earnings last week, which makes it a great time to check into how the company is doing. My last article on this name dates back to November 1, 2023 when it was busy acquiring the Euronav fleet. Things could hardly have worked out better for Frontline. After they made an aggressive major acquisition, the market remained strong to extremely strong for an extended period of time. That same month, Houthis started disrupting trade in the Bab-el-Mandeb Strait, although initially, it appeared mostly container shipping was affected. This is reflected in the share price: