From the Editor

NET ASSET VALUE AND TANKER EQUITIES
Marine Money has in the past often looked at NAV as a baseline for valuing a tanker stock. This is largely for the reason that everyone else seems to like it as a baseline, or if they do not like it, they accept it because, well, “everybody else does”. So what are we, a bunch of lemmings following the leader over the cliff? Is that what the general investing community should think of the tanker sector investors? In both cases, no.

On any of the tanker peer group noted in the below table, there are multiple reasons behind the valuation. For instance, Stelmar has been able to maintain a stronger overall valuation as its term business is perceived as value-added vis a vis its spot dependant brethren and, at the moment, is thought to have growth potential. OSG, for example, on which we do not currently have a NAV, has a high Price/Estimate Earnings (and we have calculated earnings on a pre-tax basis to level the playing field with the peers who all report as offshore and pre-tax) due somewhat to the fact that it is the old NY tanker mainstay. People have it and hold it.

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