6. Ardmore Shipping Corporation (NYSE:ASC)
Number of Hedge Fund Holders: 20
Ardmore Shipping Corporation (NYSE:ASC) is actively engaged in the transportation of petroleum products and chemicals across the globe, establishing itself as a player in the maritime sector. The company operates a fleet of mid-size product and chemical tankers, delivering essential shipping services through various arrangements, including voyage charters, time charters, and commercial pools.
Noteworthy vessels in its fleet include the Ardmore Seafarer, Ardmore Exporter, Ardmore Explorer, and Ardmore Enterprise. With an average vessel age of 9.8 years, it has one of the more modern fleets in the industry, which is a key advantage in maintaining operational efficiency and regulatory compliance. It occupies a spot on our list of the best marine shipping stocks to invest in.
As of June 30, the company’s operational fleet consisted of 26 vessels, including four chartered-in ships. The fleet is made up of 20 MR tankers, which range from 45,000 to 49,999 deadweight tonnes (dwt), as well as six Eco-Design IMO 2 product and chemical tankers, which range from 25,000 to 37,800 dwt. The combination of vessels positions it to effectively meet diverse shipping demands while building its service capabilities.
Ardmore Shipping (NYSE:ASC) reported a net income of $100.2 million for the first half of 2024. This translates to earnings of $2.41 per basic share and $2.39 per diluted share, significantly up from $66.9 million, or $1.63 per basic share and $1.60 per diluted share, in the same period of 2023. The growth in profitability highlights the company’s ability to capitalize on market opportunities and optimize its operations.
Looking ahead to the third quarter of 2024, it expects that 95% of its revenue days for MR tankers will be utilized in the spot market, with the remaining 5% under time charters. As of July 31, the company had already fixed approximately 45% of its total spot revenue days for the quarter at an average spot time charter equivalent (TCE) rate of about $34,300 per day. This includes Eco-Design MR tankers averaging $33,700 per day and Eco-Mod tankers at $38,600 per day. Such proactive management of charter agreements positions the company to benefit from favorable market conditions while securing revenue stability.
Aristotle Capital Boston, LLC stated the following regarding Ardmore Shipping Corporation (NYSE:ASC) in its Q2 2024 investor letter:
“Ardmore Shipping Corporation (NYSE:ASC), a product and chemical transportation company focused on modern mid-sized vessels, appreciated amid global refinery shifts and geopolitical factors, boosted voyage lengths and demand for product tankers. We maintain a position, as we believe the company continues to operate from a position of strength, driven by recent shareholder-friendly capital allocation decisions, strong operating performance, and a favorable industry supply-demand backdrop.”
