INSW) After Its Yearly Report
Investors in International Seaways, Inc. (NYSE:INSW) had a good week, as its shares rose 4.9% to close at US$53.99 following the release of its annual results. The result was positive overall – although revenues of US$1.1b were in line with what the analysts predicted, International Seaways surprised by delivering a statutory profit of US$11.25 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company’s performance, look at what the analysts are forecasting for next year, and see if there’s been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
See our latest analysis for International Seaways
Following the recent earnings report, the consensus from six analysts covering International Seaways is for revenues of US$1.01b in 2024. This implies a noticeable 6.2% decline in revenue compared to the last 12 months. Statutory earnings per share are forecast to decline 15% to US$9.65 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$959.9m and earnings per share (EPS) of US$8.14 in 2024. There’s been a pretty noticeable increase in sentiment, with the analysts upgrading revenues and making a decent improvement in earnings per share in particular.
Althoughthe analysts have upgraded their earnings estimates, there was no change to the consensus price target of US$64.88, suggesting that the forecast performance does not have a long term impact on the company’s valuation. There’s another way to think about price targets though, and that’s to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values International Seaways at US$74.00 per share, while the most bearish prices it at US$55.00. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the International Seaways’ past performance and to peers in the same industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 6.2% by the end of 2024. This indicates a significant reduction from annual growth of 30% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 1.8% per year. It’s pretty clear that International Seaways’ revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards International Seaways following these results. They also upgraded their revenue estimates for next year, even though it is expected to grow slower than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have forecasts for International Seaways going out to 2026, and you can see them free on our platform here.
That said, it’s still necessary to consider the ever-present spectre of investment risk. We’ve identified 2 warning signs with International Seaways (at least 1 which can’t be ignored) , and understanding them should be part of your investment process.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
