Imperial Petroleum, Inc. (IMPP) AI Stock Analysis

351 Followers

Top Page

Imperial Petroleum, Inc.

(NASDAQ:IMPP)

73Outperform

Imperial Petroleum's strong financial health, underpinned by high profitability and a solid balance sheet, is a key strength. The stock's undervaluation based on its P/E ratio further supports its attractiveness. However, technical indicators suggest bearish momentum, and challenges highlighted in the earnings call, such as declining revenues and market rates, present notable risks.

Positive Factors

Analyst Outlook

Analysts maintain a Buy rating on IMPP, reducing the price target to $7.50, indicating confidence in future performance despite recent challenges.

Earnings Performance

Despite lower-than-expected earnings, reduced share dilution led to a higher book value per share than estimated.

Financial Position

Imperial Petroleum, Inc. has a strong cash position with $206.7M and no debt, which can support ship acquisitions.

Negative Factors

Market Demand

The decrease in demand from China for dry bulk and oil has led to sharply lower shipping rates.

Operating Expenses

Total operating expenses of $27.0M, up 47.1% y/y, exceeded the $26.3M forecast due to downtime, leading to lower operating income.

Revenue Impact

Imperial Petroleum's time charter equivalent rates were significantly below forecasts, impacting revenue negatively.

Imperial Petroleum, Inc. (IMPP) vs. S&P 500 (SPY)

Market Cap

$70.67M

Dividend YieldN/A

Average Volume (3M)168.79K

Price to Earnings (P/E)1.5

Beta (1Y)0.64

Revenue Growth-19.73%

EPS Growth-95.29%

CountryUS

Employees74

SectorEnergy

Sector Strength44

IndustryOil & Gas Exploration & Production

Share Statistics

EPS (TTM)1.54

Shares Outstanding30,331,661

10 Day Avg. Volume210,211

30 Day Avg. Volume168,794

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.47

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

$5.50

Price Target Upside136.05% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

Imperial Petroleum, Inc. Business Overview & Revenue Model

Company DescriptionImperial Petroleum, Inc. (IMPP) is a shipping company that operates in the marine transportation sector, focusing primarily on the transportation of petroleum products and other liquid cargoes. The company manages a fleet of vessels that are deployed across various routes worldwide, offering logistics services essential for global energy distribution.

How the Company Makes MoneyImperial Petroleum, Inc. makes money by providing marine transportation services to oil and gas companies, refineries, and other industrial entities that require the movement of liquid cargoes. The company earns revenue primarily through the chartering of its vessels, which can be contracted on a time charter or spot charter basis. Time charters involve leasing vessels for a fixed period, providing steady and predictable income, while spot charters are typically shorter-term agreements that allow the company to capitalize on fluctuating market rates. Additionally, IMPP may engage in strategic partnerships with other shipping companies or stakeholders in the oil and gas industry to optimize fleet utilization and expand market reach. Factors such as global oil demand, fuel prices, and regulatory changes in maritime shipping can significantly influence the company's earnings.

Imperial Petroleum, Inc. Financial Statement Overview

Summary

Imperial Petroleum demonstrates strong financial performance with high profitability and operational efficiency. The robust balance sheet with minimal debt enhances stability. However, recent revenue and free cash flow declines present potential challenges.

Income Statement

Positive

Imperial Petroleum has shown strong revenue growth over the years with a significant increase in gross profit and net income. The 2024 annual report shows a gross profit margin of 45.7% and a net profit margin of 34.0%, indicating strong profitability. However, the revenue decreased from 2023 to 2024, suggesting a potential challenge in maintaining growth. EBIT and EBITDA margins are also healthy, supporting operational efficiency.

Balance Sheet

Positive

The company exhibits a robust balance sheet with a high equity ratio of 93.6% in 2024, indicating strong financial stability and low reliance on debt. The return on equity (ROE) is impressive at 11.9%, showcasing effective use of equity to generate profits. The debt-to-equity ratio is negligible due to low total debt, reducing financial risk.

Cash Flow

Positive

Cash flow analysis shows a decline in free cash flow from 2023 to 2024, with a free cash flow growth rate of -94.1%. The operating cash flow to net income ratio is favorable at 1.55, indicating strong cash generation relative to income. However, the decrease in free cash flow poses a potential liquidity concern.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
147.48M	183.73M	97.02M	17.36M	20.30M
	Gross Profit
67.39M	73.37M	32.64M	-2.34M	367.66K
	EBIT
44.14M	66.02M	29.82M	-3.49M	-355.30K
	EBITDA
62.72M	88.59M	43.41M	5.18M	8.25M
	Net Income Common Stockholders
50.16M	71.13M	29.51M	-3.78M	-403.77K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
206.73M	124.03M	118.90M	3.39M	6.45M
	Total Assets
449.51M	376.83M	366.58M	128.47M	138.12M
	Total Debt
78.76K	0.00	69.96M	27.84M	0.00
	Net Debt
-79.70M	-91.93M	19.06M	24.45M	-6.45M
	Total Liabilities
28.84M	14.53M	84.17M	31.72M	4.06M
	Stockholders Equity
420.67M	362.31M	282.41M	96.75M	134.06M
Cash Flow		Free Cash Flow
3.02M	51.39M	-77.78M	5.10M	8.14M
	Operating Cash Flow
77.70M	79.53M	40.90M	5.24M	8.87M
	Investing Cash Flow
-94.65M	12.29M	-186.68M	-142.60K	-728.00K
	Financing Cash Flow
4.81M	-57.40M	196.95M	-6.37M	-9.33M

Imperial Petroleum, Inc. Technical Analysis

Technical Analysis Sentiment

Negative

Last Price2.33

Price Trends

50DMA

2.58

Negative

100DMA

2.82

Negative

200DMA

3.36

Negative

Market Momentum

MACD

-0.04

Negative

RSI

40.63

Neutral

STOCH

35.76

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IMPP, the sentiment is Negative. The current price of 2.33 is below the 20-day moving average (MA) of 2.44, below the 50-day MA of 2.58, and below the 200-day MA of 3.36, indicating a bearish trend. The MACD of -0.04 indicates Negative momentum. The RSI at 40.63 is Neutral, neither overbought nor oversold. The STOCH value of 35.76 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IMPP.

Imperial Petroleum, Inc. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
NMM	75 Outperform	$935.64M	2.65	12.46%	0.63%	2.08%	-14.91%
DHT	74 Outperform	$1.58B	8.75	17.56%	8.96%	2.11%	13.10%
FRO	74 Outperform	$3.12B	6.30	21.46%	12.69%	13.77%	-24.50%
IMPP	73 Outperform	$70.67M	1.51	12.81%	―	-19.73%	-95.29%
STNG	72 Outperform	$1.66B	2.42	24.68%	4.81%	-7.25%	31.85%
INSW	63 Neutral	$1.51B	3.65	23.33%	15.49%	-11.21%	-25.50%
Sector *	57 Neutral	$7.56B	4.34	-4.83%	6.50%	-0.19%	-64.77%

* Energy Sector Average

Performance Comparison

IMPP

Imperial Petroleum, Inc.

2.33

-1.06

-31.27%

DHT

DHT Holdings

10.60

0.24

2.32%

FRO

Frontline

15.50

-6.62

-29.93%

NMM

Navios Maritime Partners

31.73

-10.62

-25.08%

STNG

Scorpio Tankers

35.69

-32.92

-47.98%

INSW

International Seaways

33.24

-13.43

-28.78%

Imperial Petroleum, Inc. Earnings Call Summary

Earnings Call Date: Feb 13, 2025 | % Change Since: -20.75% | Next Earnings Date: Jun 17, 2025

Earnings Call Sentiment Neutral

The call highlighted strong operational performance, fleet growth, and a robust financial position despite facing challenges such as declining market rates and foreign exchange losses. The company's strong profitability and cash reserves are notable positives.

Highlights

Strong Operational Utilization

Achieved an operational utilization rate of 86% in Q4 2024, attributed to increased time charter coverage.

Fleet Growth

Increased fleet size with the delivery of the product tanker Clean Imperial, bringing the total fleet to 12 vessels.

Annual Profitability

Ended 2024 with a profit of approximately $50 million and an operating cash flow close to $78 million.

Debt-Free Capital Structure

Maintained a debt-free status, facilitating robust cash flow generation.

Cash Reserves

A hefty cash base of close to $207 million, with a 67% increase in available cash placed under time deposits.

Lowlights

Decline in Market Rates

Revenues for Q4 2024 were $26.2 million, marking a $3.5 million decline compared to the same period in 2023, due to lower market rates.

Foreign Exchange Loss

Incurred a $3.3 million foreign exchange loss due to the strengthening of the U.S. dollar.

Weaker Market Conditions

The second half of 2024 saw softer market conditions with a decline in daily rates for tankers.

Company Guidance

During the Q4 and full-year 2024 conference call, Imperial Petroleum reported on its operational and financial performance amidst atypical market conditions. The company achieved an operational utilization rate of 86% for Q4 and 78.3% for the entire year, with 29% of fleet days dedicated to time charter activity. Despite softer market conditions impacting quarterly revenues, which totaled $26 million, the company maintained strong operating income of nearly $5 million and a net income of $3.9 million. Annual results were robust, with a net income of $50 million and operating cash flow approximating $78 million. The fleet expanded to 12 vessels following the addition of the Clean Imperial tanker. Imperial Petroleum highlighted a debt-free balance sheet and a stable cash base of $207 million, signaling a 67% increase in available cash over the year. Looking forward, the company aims to capitalize on growth opportunities and sustain profitability in 2025, with anticipated oil demand growth driven by emerging economies and a recovering Chinese market.

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.