DHT Holdings (DHT) AI Stock Analysis

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DHT Holdings

(NYSE:DHT)

76Outperform

DHT Holdings receives a strong overall score, driven primarily by its robust financial performance and positive earnings call outcomes. The company's strong cash flow generation and strategic management actions, such as share repurchases and vessel sales, have bolstered its financial position. Additionally, its attractive valuation supports its appeal to investors. The technical analysis presents a mixed outlook, with potential bearish momentum offset by a neutral RSI. Overall, DHT Holdings is well-positioned for future growth, but attention to market volatility and older fleet management is necessary.

Positive Factors

Dividend Strategy

DHT's 100% payout of net income dividend strategy and low leverage position it to payout higher dividends as VLCC rates move higher.

Market Positioning

DHT's fleet primarily trades in the spot market, positioning it to take advantage of increasing rates and rate spikes.

Revenue Enhancement

DHT's fleet is fully scrubber fitted, which provides an advantage by adding $6-10k per day to VLCC rates.

Negative Factors

DHT Holdings (DHT) vs. S&P 500 (SPY)

Market Cap

$1.67B

Dividend Yield9.12%

Average Volume (3M)2.04M

Price to Earnings (P/E)9.3

Beta (1Y)0.35

Revenue Growth2.11%

EPS Growth13.10%

CountryUS

Employees924

SectorEnergy

Sector Strength53

IndustryOil & Gas Midstream

Share Statistics

EPS (TTM)1.12

Shares Outstanding160,557,980

10 Day Avg. Volume2,686,739

30 Day Avg. Volume2,040,612

Financial Highlights & Ratios

PEG Ratio0.71

Price to Book (P/B)N/A

Price to Sales (P/S)3.06

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$13.50

Price Target Upside29.56% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering2

DHT Holdings Business Overview & Revenue Model

Company DescriptionDHT Holdings, Inc., through its subsidiaries, owns and operates crude oil tankers primarily in Monaco, Singapore, and Norway. As of March 17, 2022, it had a fleet of 26 very large crude carriers with a capacity of 8,043,657 deadweight tons. The company was incorporated in 2005 and is headquartered in Hamilton, Bermuda.

How the Company Makes MoneyDHT Holdings makes money primarily through the chartering of its VLCC fleet to customers on the spot market and through fixed-rate contracts. The company earns revenue by leasing its vessels to oil companies and traders who need to transport crude oil from production sites to refineries and other destinations. The spot market involves short-term charters where rates can vary based on global oil demand and supply dynamics, while fixed-rate contracts offer more predictable income over longer periods. DHT Holdings' earnings are influenced by factors such as global oil production levels, the demand for oil transportation, and fluctuations in charter rates. Strategic partnerships with major oil corporations and efficient fleet management also contribute to the company's revenue generation.

DHT Holdings Financial Statement Overview

Summary

DHT Holdings exhibits strong profitability with stable leverage and efficient cash flow management. The company showed improvement in key profitability metrics and maintains a healthy balance sheet. Cash flow metrics underscore strong liquidity and operational efficiency, though revenue growth has stabilized.

Income Statement

Positive

DHT Holdings has demonstrated strong improvements in profitability metrics. The gross profit margin for 2024 stood at 54.82%, up from 37.56% in 2023, indicating efficient cost management. The net profit margin improved to 31.72% in 2024 from 28.79% in 2023, reflecting enhanced bottom-line profitability. Revenue growth was modest at 2.00%, showing stability compared to a significant 23.43% growth the previous year. The EBIT margin increased to 36.84% from 34.44%, while the EBITDA margin slightly decreased to 51.52% from 54.23%. Overall, DHT Holdings shows strong profitability with slight growth in revenue.

Balance Sheet

Positive

DHT Holdings maintains a stable financial position with a debt-to-equity ratio of 0.39, indicating moderate leverage. The return on equity improved to 17.47% in 2024, up from 15.71% in 2023, demonstrating efficient utilization of equity. The equity ratio stands at 69.86%, slightly up from 68.83%, reflecting a strong capital structure. While the company has managed its debt well, the overall asset base has slightly decreased, requiring attention to future asset management strategies.

Cash Flow

Very Positive

Cash flow analysis reveals strong operational cash generation with a 18.78% increase in operating cash flow from 2023 to 2024. Free cash flow also grew significantly by 63.70%, indicating strong cash conversion capabilities. The operating cash flow to net income ratio was 1.65, showcasing robust operational efficiency. The free cash flow to net income ratio improved to 1.11, signaling effective management of capital expenditures and debt obligations. Overall, the cash flow metrics underscore strong liquidity and operational efficiency.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
571.77M	560.56M	454.14M	295.85M	691.04M
	Gross Profit
313.56M	210.56M	71.58M	-3.00M	344.04M
	EBIT
210.64M	193.11M	54.27M	-13.02M	313.59M
	EBITDA
324.35M	304.01M	210.69M	124.23M	450.40M
	Net Income Common Stockholders
181.38M	161.35M	61.52M	-11.51M	266.27M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
78.14M	74.74M	125.95M	60.66M	68.64M
	Total Assets
1.49B	1.49B	1.51B	1.61B	1.62B
	Total Debt
409.42M	430.14M	396.69M	522.30M	449.96M
	Net Debt
331.28M	355.40M	270.75M	461.64M	381.32M
	Total Liabilities
443.89M	460.56M	434.99M	562.00M	513.05M
	Stockholders Equity
1.04B	1.03B	1.07B	1.05B	1.11B
Cash Flow		Free Cash Flow
201.62M	123.18M	117.76M	-114.04M	502.32M
	Operating Cash Flow
298.65M	251.41M	127.91M	60.56M	529.87M
	Investing Cash Flow
-97.03M	-124.98M	110.52M	-86.51M	-26.72M
	Financing Cash Flow
-197.91M	-177.76M	-173.34M	17.97M	-501.87M

DHT Holdings Technical Analysis

Technical Analysis Sentiment

Positive

Last Price10.42

Price Trends

50DMA

10.56

Negative

100DMA

10.22

Positive

200DMA

10.35

Positive

Market Momentum

MACD

-0.12

Negative

RSI

51.16

Neutral

STOCH

66.98

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DHT, the sentiment is Positive. The current price of 10.42 is above the 20-day moving average (MA) of 10.32, below the 50-day MA of 10.56, and above the 200-day MA of 10.35, indicating a neutral trend. The MACD of -0.12 indicates Negative momentum. The RSI at 51.16 is Neutral, neither overbought nor oversold. The STOCH value of 66.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DHT.

DHT Holdings Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TNK	82 Outperform	$1.37B	3.43	23.93%	2.51%	-16.70%	-24.06%
FRO	76 Outperform	$3.44B	6.94	21.46%	11.53%	13.77%	-24.50%
DHT	76 Outperform	$1.67B	9.27	17.56%	9.12%	2.11%	13.10%
STNG	75 Outperform	$1.76B	2.56	24.68%	4.53%	-7.25%	31.85%
TRGP	69 Neutral	$37.98B	30.43	47.62%	1.72%	6.45%	56.33%
INSW	68 Neutral	$1.64B	3.97	23.33%	15.45%	-11.21%	-25.50%
Sector *	55 Neutral	$7.05B	3.47	-6.10%	6.00%	-0.44%	-51.04%

* Energy Sector Average

Performance Comparison

DHT

DHT Holdings

10.42

0.15

1.46%

FRO

Frontline

15.44

-5.52

-26.34%

STNG

Scorpio Tankers

35.33

-32.57

-47.97%

TRGP

Targa Resources

174.57

63.04

56.52%

TNK

Teekay Tankers

39.84

-13.76

-25.67%

INSW

International Seaways

33.34

-14.38

-30.13%

DHT Holdings Earnings Call Summary

Earnings Call Date: Feb 5, 2025 | % Change Since: -10.33% | Next Earnings Date: May 13, 2025

Earnings Call Sentiment Positive

The earnings call depicted a generally positive performance for DHT Holdings, with strong financial metrics and strategic achievements such as successful share repurchases and vessel sales. The positive market outlook and constructive fleet supply story further underscore the company's favorable position. However, challenges related to market volatility, older fleet management, and geopolitical factors were also highlighted.

Highlights

Strong Financial Performance

DHT Holdings reported a net income of $54.7 million for Q4 2024, equal to $0.34 per share. After adjustments, net income was $26.8 million, equal to $0.17 per share. The company also had a total liquidity of $258 million at the end of the quarter.

Successful Share Repurchase

DHT repurchased 1.5 million shares at an average price of $8.89, which was accretive to earnings per share and net asset value.

Sale of Older Vessel

DHT sold the DHT Scandinavia, a ship built in 2006, for $43.4 million, generating a book gain of approximately $19.8 million.

Positive Market Outlook

The market for modern VLCCs with exhaust gas cleaning systems is estimated to be in the $55,000 to $60,000 a day range, with strong customer interest in time charter contracts.

Constructive Supply Story

DHT highlighted favorable fleet demographics and a shrinking VLCC fleet, with 444 VLCCs estimated to be older than fifteen years by the end of 2026.

Lowlights

Challenges with Older Fleet

DHT continues to face challenges in divesting older ships, with some vessels in the fleet being built in 2007 and facing limited commercial opportunities.

Market Volatility

The VLCC spot market experienced significant volatility, partly driven by geopolitical factors and sentiment changes rather than consistent demand increases.

Sanction Impacts

Sanctions and fiscal issues, particularly in China, are affecting procurement behaviors and could disrupt trade, although they also present some opportunities for DHT.

Company Guidance

During the Q4 2024 earnings call for DHT Holdings, the company reported a robust financial performance, highlighting a total liquidity of $258 million, including $78 million in cash and $180 million available under revolving credit facilities. The company's financial leverage was 18%, and net debt was $13.8 million per vessel. Revenue on a TCE basis was $85.5 million, with an EBITDA of $60.6 million and a net income of $54.7 million, or $0.34 per share. After adjustments for prior impairment reversals, adjusted net income was $26.8 million, or $0.17 per share. Vessel operating expenses were $20 million, and G&A expenses totaled $5.6 million, including a non-recurring item of $0.7 million. The average TCE for spot market vessels was $38,200 per day, with younger vessels and those on time charter achieving $40,500 per day. For the full year 2024, adjusted net income was $153.6 million, or $0.95 per share. Looking ahead, DHT Holdings plans to allocate proceeds from asset sales to general corporate purposes, including investments and debt prepayment, and anticipates a one-year time charter for DHT China at $40,000 per day. The company declared a Q4 dividend of $0.17 per share and estimated G&A and depreciation expenses for 2025. The market outlook remains positive, with increasing demand and supportive fleet demographics expected to benefit the VLCC segment.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.