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Navigator Holdings (NVGS)
NYSE:NVGS
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Navigator Holdings
(NYSE:NVGS)
73Outperform
Positive Factors
Contracts
A second multi-year off-take contract for the expanded portion of the ethylene terminal has been signed.
Earnings
Navigator reported a 4Q earnings beat on higher revenues.
Infrastructure Expansion
The company completed the ethylene terminal expansion on time and within budget.
Negative Factors
Corporate Strategy
The company is considering re-domiciling to the UK, which is expected to have a minor effect on taxes and finances.
Financial Commitments
Navigator is evaluating a new financing package to secure additional off-take.
Fleet Expansion
Navigator announced the acquisition of three new ethylene ships for $84 million.
Navigator Holdings (NVGS) vs. S&P 500 (SPY)
Market Cap
$944.03M
Dividend Yield1.46%
Average Volume (3M)236.48K
Price to Earnings (P/E)11.5
Beta (1Y)0.44
Revenue Growth2.89%
EPS Growth8.17%
CountryUS
Employees175
SectorEnergy
Sector Strength87
IndustryFossil Fuels
Share Statistics
EPS (TTM)1.19
Shares Outstanding69,261,350
10 Day Avg. Volume316,413
30 Day Avg. Volume236,483
Financial Highlights & Ratios
PEG Ratio1.41
Price to Book (P/B)N/A
Price to Sales (P/S)1.85
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
$21.75Price Target Upside62.43% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
Navigator Holdings Business Overview & Revenue Model
Company DescriptionNavigator Holdings Ltd. (NVGS) is a leading international owner and operator of handysize liquefied gas carriers. The company specializes in the seaborne transportation of liquefied petroleum gas (LPG), petrochemical gases, and ammonia. With a modern fleet of sophisticated vessels, Navigator Holdings serves a global customer base, providing efficient and reliable shipping services across diverse geographic markets. Their operations are focused on the safe and environmentally responsible transport of gas products, catering to the needs of both industrial and residential consumers worldwide.
How the Company Makes MoneyNavigator Holdings generates revenue primarily through the chartering of its fleet of liquefied gas carriers. The company operates under a time charter model, where it leases its vessels to major oil and gas companies, petrochemical manufacturers, and energy trading firms for fixed periods. The charter contracts guarantee a steady stream of income, providing predictable cash flows. Additionally, Navigator Holdings engages in spot charters, where vessels are hired for single voyages at prevailing market rates, allowing the company to capitalize on favorable market conditions. Strategic partnerships with key industry players, as well as its focus on maintaining a versatile and modern fleet, further enhance its revenue-generating capabilities. The company's earnings are influenced by factors such as global demand for LPG and petrochemical gases, shipping rates, and operational efficiencies.
Navigator Holdings Financial Statement Overview
Summary
Navigator Holdings presents a solid financial position with strong profitability, efficient cash flow management, and a stable balance sheet. The company's robust margins and cash flow metrics position it well for future resilience, despite moderate revenue and asset growth rates.Income Statement
Navigator Holdings shows strong profitability with a solid gross profit margin of 31.8% and net profit margin of 14.5% for TTM (Trailing-Twelve-Months). The company has demonstrated consistent revenue growth, increasing from $550.7 million in 2023 to $564.3 million in TTM, reflecting a 2.5% growth rate. The EBIT margin is robust at 25.1%, and the EBITDA margin stands at an impressive 46.0%, indicating efficient operations. However, the growth rate, while positive, is moderate.78
Positive
Balance Sheet
The balance sheet of Navigator Holdings reflects a stable financial structure with a debt-to-equity ratio of 0.47, which is relatively low for the industry, indicating prudent use of leverage. The return on equity (ROE) is healthy at 6.88% for TTM, showcasing effective use of shareholders' capital. The equity ratio of 55.9% underscores a strong equity base, providing financial stability. However, the company's asset growth has been modest, which could limit future expansion.72
Positive
Cash Flow
Navigator Holdings exhibits strong cash flow health with a significant free cash flow of $216.9 million for TTM and a remarkable free cash flow growth rate from negative in 2023 to positive in TTM. The operating cash flow to net income ratio is robust at 2.95, indicating strong cash generation relative to reported earnings. The free cash flow to net income ratio is healthy at 2.65, demonstrating excellent cash conversion. These metrics highlight efficient cash management.85
Very Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 564.28M | 550.74M | 473.79M | 403.58M | 332.50M | 301.38M | Gross Profit |
| 179.31M | 170.51M | 88.92M | 90.65M | 70.52M | 58.43M | EBIT |
| 141.41M | 137.23M | -70.51M | 56.42M | 41.75M | 32.61M | EBITDA |
| 259.75M | 264.69M | 212.09M | 149.12M | 118.44M | 109.66M | Net Income Common Stockholders |
| 81.73M | 82.25M | 29.08M | -46.79M | 662.00K | -15.48M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 71.52M | 149.58M | 153.19M | 124.01M | 59.06M | 66.13M | Total Assets |
| 1.83B | 2.20B | 2.10B | 2.16B | 1.84B | 1.87B | Total Debt |
| 835.95M | 857.05M | 810.54M | 920.50M | 792.50M | 816.90M | Net Debt |
| 764.43M | 698.81M | 657.35M | 796.49M | 733.45M | 750.77M | Total Liabilities |
| 877.64M | 969.61M | 923.33M | 1.04B | 897.01M | 934.67M | Stockholders Equity |
| 955.11M | 1.19B | 1.16B | 1.11B | 940.54M | 939.80M |
| Cash Flow | Free Cash Flow | ||||
| 216.88M | -17.26M | 84.54M | 99.05M | 42.41M | 46.43M | Operating Cash Flow |
| 241.35M | 174.70M | 130.31M | 102.59M | 44.67M | 49.70M | Investing Cash Flow |
| -28.06M | -176.48M | 35.64M | 28.25M | -16.15M | -90.41M | Financing Cash Flow |
| -255.66M | 6.81M | -134.14M | -66.09M | -35.38M | 35.32M |
Navigator Holdings Technical Analysis
Negative
13.39
Price Trends
15.43
Negative
15.52
Negative
15.86
Negative
Market Momentum
-0.49
Negative
29.00
Positive
16.81
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NVGS, the sentiment is Negative. The current price of 13.39 is below the 20-day moving average (MA) of 14.05, below the 50-day MA of 15.43, and below the 200-day MA of 15.86, indicating a bearish trend. The MACD of -0.49 indicates Negative momentum. The RSI at 29.00 is Positive, neither overbought nor oversold. The STOCH value of 16.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NVGS.
Navigator Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $1.95B | 2.84 | 24.68% | 4.07% | -7.25% | 31.85% | |
75 Outperform | $990.50M | 5.90 | 15.72% | ― | -24.25% | -48.08% | |
74 Outperform | $3.51B | 7.22 | 21.46% | 12.38% | 13.77% | -24.50% | |
73 Outperform | $944.03M | 11.53 | 7.14% | 1.46% | 2.89% | 8.17% | |
71 Outperform | $4.15B | 84.86 | 2.44% | 2.52% | -12.75% | ― | |
67 Neutral | $1.19B | 8.14 | 12.05% | 13.08% | 20.22% | 52.03% | |
58 Neutral | $9.25B | 5.52 | -6.24% | 7.43% | -0.10% | -69.94% |
* Energy Sector Average
Performance Comparison
NVGS
Navigator Holdings
13.39
-1.72
-11.38%
FRO
Frontline
14.91
-6.50
-30.36%
GLNG
Golar LNG
39.22
15.92
68.33%
STNG
Scorpio Tankers
38.05
-31.51
-45.30%
SFL
SFL Corporation
8.16
-3.73
-31.37%
LPG
Dorian LPG
22.43
-11.85
-34.57%
Navigator Holdings Earnings Call Summary
Earnings Call Date: Mar 12, 2025 | % Change Since: -2.55% | Next Earnings Date: May 26, 2025
Earnings Call Sentiment Positive
Navigator Holdings demonstrated strong financial performance with revenue growth, high vessel utilization, and successful bond issuance. However, challenges such as softer ethylene demand and geopolitical tensions present potential risks. The overall sentiment is slightly positive, with significant achievements outweighing the challenges.Highlights
Revenue Growth and EBITDA Increase
Fourth quarter revenue increased by 2% year-over-year, with adjusted EBITDA reaching over $73 million, up from $72 million the previous year and $68 million in Q3.
Strong Balance Sheet and Cash Position
The company maintains a strong balance sheet with a robust cash position despite significant repayments, including a $50 million terminal expansion project installment.
Successful Bond Issuance
Issued $100 million of unsecured bonds at 7.25%, marking the tightest spread for a dollar-denominated shipping bond in the Nordic market since 2008.
High Vessel Utilization
Achieved over 92% vessel utilization in Q4, higher than both Q3 and the same period the previous year.
Ethylene Terminal Expansion Completed
The expansion was completed on time and on budget, increasing the terminal's capacity significantly.
Capital Return to Shareholders
Continued capital return with a $0.05 fixed dividend and share buyback totaling 25% of net income.
Additional Vessel Acquisitions
Acquired three handysize ethylene carriers for $83.9 million, expanding the fleet to support terminal operations.
Lowlights
Softer Ethylene Transport Demand
The market was temporarily hit by softer ethylene transport demand, affecting performance.
Challenges in Ethylene Throughput
Despite an increase from Q3, throughput at the joint venture Ethylene export terminal was lower than Q4 2023 and below capacity due to US cracker turnarounds.
Geopolitical Tensions Impacting Forecasting
Geopolitical tensions reduce the ability to do long-term forecasting.
Depressed Ethylene Arbitrage
The ethylene arbitrage remains tight due to higher domestic prices, affecting export activity.
Company Guidance
During the Navigator Holdings conference call for the Fourth Quarter 2024, the company provided detailed guidance on various metrics. The company reported an increase in revenues by 2% year-over-year, with an adjusted EBITDA of $73.4 million for the quarter, surpassing the previous year's $72 million and the third quarter's $68 million. The balance sheet remained strong, despite a $50 million payment for terminal expansion and other debt repayments. The company issued $100 million in new unsecured bonds at 7.25% and maintained average TCE rates at $28,341 per day with utilization above 92%. Ethylene export terminal throughput was 159,000 tons, impacted by US cracker turnarounds, but the terminal expansion was completed on time and budget. The company also acquired three handysize ethylene carriers for $83.9 million and exercised options for two new mid-size ethylene carriers. Looking ahead, Navigator Holdings expects high vessel utilization and robust TCE rates in Q1 2025 and plans to continue its capital return through dividends and share buybacks.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.