Summary
- International Seaways is seen as one of the top shipping stocks for Q4 2020.
- The company reported a net income of $64.4 million in Q2 2020, compared to a net loss of $16.5 million in Q2 2019.
- Undervalued stock with a trailing P/E ratio of 4x, with analyst upside of 103.9%.
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Stocks aren't cheap and popular at the same time.
- Unknown
Stocks involved in petroleum have been hit hard since March. Whether the company is directly involved in oil refining, exploration, or transportation, these stocks are largely dependent on crude oil prices and demand. Clearly, if 2020 has shown us anything, it is that these are largely dependent on forces beyond anyone's control. While oil prices have recovered, they are nowhere near pre-pandemic levels and are continuing to slog. As long as COVID-19 is around, stocks involved in oil could have a long, choppy recovery.
While certain stocks and industries have experienced robust returns since the bottoms of March, other stocks have not. Many of these stocks, especially in the oil and gas sector, are extraordinarily undervalued and at attractive entry points. They generally have better financials than overvalued tech names, and are also managing to grow their net income. Certain stocks, such as International Seaways Inc. (INSW), offer investors attractive multiples and attractive financials. While many analysts and investors want to avoid any stock with remote association to energy, others are just starting to notice the upside potential.
Opportunities In The Shipping Space
International Seaways, Inc. owns and operates a fleet of crude oil and petroleum transportation vessels. While stocks involved with oil still pose significant risks, the upside potential for stocks such as International Seaways is immense. Although the company primarily transports crude oil and petroleum products, the shipping industry includes companies that transport any sort of cargo around the world. Shipping stocks were some of the hardest hit when the coronavirus began ravaging the world. In fact, the Invesco Shipping ETF stopped trading after plummeting so much. However, individual stocks such as International Seaways, with strong financials and low valuations, are prime to be bought low right now and could be at the forefront of a recovery rally once the world begins to return to normal.
