Aegean Marine: Speculative Play in Shipping Logistics

08/15/2017 2:50 am EST

Focus: TRANSPORTATION

Bill Mathews

Editor & Founder, The Cheap Investor

Aegean Marine Petroleum Network (ANW) operates as a marine fuel logistics company that markets and supplies refined marine fuel and lubricants to vessels in port, at sea, and on rivers worldwide, notes Bill Mathews, editor of The Cheap Investor.


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The Ccmpany offers fueling services to ocean-going and a range of coastal vessels, including oil tankers, container ships, drybulk carriers, cruise ships, reefers, LNG carriers, car carriers, and ferries, as well as to marine fuel traders, brokers, and other end-users of marine fuel and lubricants.

As of December 31, 2016, the company owned and operated a fleet of 46 bunkering vessels and 15 double-hull bunkering vessels. It also operated 10 land-based storage facilities and 2 vessels as floating storage facilities.

Aegean Marine traded as high at $12.95 in April. It has solid fundamentals, but the stock is selling at a low price primarily because it’s in an oil-related industry, and crude oil is at low prices right now.

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The company has a good balance sheet with $60 million ($1.53 per share) in cash, a book value of $15.11 per share and a large debt of $853 million. (High debt is common in this sector.) T

The stock does pay a small dividend. On May 23, 2017, the Company's Board of Directors declared a first quarter 2017 dividend of $0.02 per share.

There are 39.5 million shares outstanding, and 115 institutions own 81% of the float (shares in public hands). During the quarter ended March 31, 2017, institutions purchased 2.3 million more shares than they sold.

On the negative side, Aegean Marine has significantly lower net income that a year ago, and it is a foreign company, based in Athens, Greece.

This profitable, NYSE-listed stock has large institutional ownership, yet it has only 39.5 million shares outstanding. If the Company turns around its net income; and/or the price of crude oil moves upward, the stock has the potential to move 50% to 100%.

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