On Friday, BTIG initiated coverage on Hafnia Ltd. (NYSE:HAFN) with a Buy rating and a $10 price target. The firm's analysis followed Hafnia's recent listing on the New York Stock Exchange earlier in the week, noting the company's dual listing in New York and Oslo. Hafnia, which operates a diversified fleet of approximately 105 product tankers, is primarily engaged in the transportation of refined oil products and chemicals.
The company's fleet consists of roughly 105 owned vessels, about 11 vessels owned through joint ventures, and approximately 14 chartered-in vessels. Additionally, Hafnia benefits from its participation in eight commercial pools, which include around 70 tankers owned by third parties.
BTIG's bullish stance on the ongoing product tanker cycle is based on several key factors. First, there is a shift of global refinery capacity to exporting regions such as the Middle East and Africa, moving away from developed OECD countries. Second, the firm anticipates firm oil demand growth, expecting year-over-year growth of around 2% in 2024 and approximately 1% in 2025.
Third, the supply growth picture is seen as attractive, with an estimated average annual fleet growth of about 4% over the next three years, aligning with the 10-year average.
The analyst from BTIG highlighted the positive outlook for Hafnia, stating, "Bottom line: we remain bullish on the ongoing product tanker cycle."
InvestingPro Insights
In light of BTIG's optimistic coverage of Hafnia Ltd. (NYSE:HAFN), recent data from InvestingPro further supports the company's strong market position. Hafnia's market capitalization stands at a robust $3.78 billion, reflecting investor confidence. The company has shown impressive revenue growth, with a 38.68% increase over the last twelve months as of Q4 2023. This surge is further emphasized by a remarkable quarterly revenue growth of 74.09% in Q4 2023. Moreover, Hafnia's gross profit margin is healthy at 39.79%, indicating efficient operations and a strong ability to translate sales into profits.
InvestingPro Tips highlight the company's solid financial performance, with an operating income of $801.86 million over the last twelve months as of Q4 2023. Additionally, the company's EBITDA has grown by 0.72% in the same period, showcasing stability in earnings before interest, taxes, depreciation, and amortization. These metrics are particularly relevant for investors considering Hafnia's recent NYSE listing and BTIG's Buy rating.
For those seeking more in-depth analysis, InvestingPro offers additional tips on Hafnia and similar companies. By using the coupon code PRONEWS24, investors can receive an extra 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a wealth of expert insights. Currently, there are 5 more InvestingPro Tips available for Hafnia, providing further guidance for those interested in this promising product tanker company.
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