Movers and SHAKERS
Pyxis Tankers Inc. (PXS)
Floating Storage Enhances Refined Product Tanker Outlook
Pyxis Tankers Inc is a United States-based international maritime transportation company which focuses on the product tanker sector. It owns a fleet which comprises of double hull product tankers employed under a mix of short- and medium-term time charters and spot charters. The fleet owned by the company includes Pyxis Epsilon, Pyxis Theta, Pyxis Malou, Pyxis Delta, Northsea Alpha, and Northsea Beta. Each of the vessels in the fleet is capable of transporting refined petroleum products, such as naphtha, gasoline, jet fuel, kerosene, diesel, fuel oil, and other liquid bulk items, such as vegetable oils and organic chemicals.
Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Floating storage demand is boosting near-term refined product tanker market outlook. Global crude oil and refined product demand has dropped sharply due to measures to curb the Coronavirus and onshore storage capacity is filling up. The net result is higher demand for floating storage. Initially, crude oil tankers were positively impacted, but traders/marketers are looking for refined product tankers for storage of refined products to take advantage of attractive market conditions. As a result, the near-term outlook for MRs has improved markedly and TCE rates are moving higher. While it is difficult to predict when floating storage demand moderates and inventory destocking will ramp up, the long-term fundamentals remain attractive due to a shift in refining capacity in the eastern hemisphere and a limited order book (at the lowest level since 2000).
Maintaining 2020 EBITDA estimate, but positive surprises could materialize. Our 2020 EBITDA estimate remains at $6.9 million based on TCE rates of $13.5k/day and 1,589 operating days. Two one-year options recently expired so now all of the MRs are slated to reprice in 2Q2020; the Malou and Theta over the next month and the Epsilon in late June after a special survey. Operating leverage is high and each $1,000/day increase on the three MRs equates to EBITDA of $0.5 million over 2H2020. Due to Coronavirus related admin disruptions, 1Q2020 operating results could be pushed out into...
This research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.