Frontline Stock Slides After Q3 Earnings Miss: Retail Sentiment Sours
By Stocktwits Inc | First Published Nov 29, 2024, 8:30 AM ISTRetail sentiment on the stock turned 'bearish' (34/100) from 'neutral' (47/100).
Shares of international shipping company Frontline ($FRO) were down 6% on Wednesday afternoon after the company's third-quarter earnings missed Wall Street estimates, bringing down retail sentiment.
Earnings per share came in at $0.27, below consensus estimates of $0.36, according to Stocktwits data. However, its revenues stood at $490.32 million, above the expected estimates of $309 million quoted by analysts.
For the third quarter, the company declared a cash dividend of $0.34 per share for the third quarter of 2024.
Retail sentiment on the stock turned 'bearish' (34/100) from 'neutral' (47/100) a day ago, while message volumes moved to extremely high levels.
“The third quarter of 2024 performed in line with seasonal expectations, as oil demand slowed over the summer months and domestic demand by oil exporting countries in the Middle East increased. We continue to sail in a troubled geopolitical landscape and with lower year-on-year demand in Asia, and especially China, the tanker markets have yet to experience the seasonal upswing into winter," Lars H. Barstad, CEO of Frontline, said in a statement.
"The increase in sanctioned oil trade and movement of illicit barrels have negatively impacted our trade environment. However, global oil demand is still growing, and with limited new tanker capacity coming, Frontline continues to profit as we run our cost-efficient operation and modern fleet. It will be interesting to see how the tanker market, including the trade of oil and energy, is impacted by politics as we approach 2025," Barstad added.
In the third quarter, the company also sold its oldest Suezmax tanker for $48.5 million, generating net cash proceeds of $36.5 million after repayment of existing debt. It also entered into a sale-and-leaseback agreement of up to $512.1 million to refinance 10 Suezmax tankers. That refinancing is expected to generate net cash proceeds of about $101.0 million in the fourth quarter of 2024, the company statement added.
Frontline stock is down 16.32% year-to-date.
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