Scorpio Bulkers (NYSE:SALT): Moderate Growth Anticipated for Medium Bulkers; Downgrade to Neutral

Scorpio Bulkers (NYSE:SALT) - A Value Stock in the Making

Scorpio Tankers (NYSE:SALT): 3Q19 Result Update

Drewry Maritime Financial Research

Ishan Dafaria

Maritime Sector, Equity & Credit Research

With no ties to other players in the shipping, finance or banking world, we provide a uniquely impartial view of the markets and companies we cover. Our parent organization, Drewry is a leading independent provider of research services to the maritime and shipping industry, employing over 100 professionals across an international network of offices in London, Delhi, Singapore and Shanghai. Combining our market-leading resources with seasoned sector expertise DFRS offers a highly differentiated and comprehensive range of investment and financial research services to lenders and prospective investors in publicly listed maritime and shipping companies. The full service of reports, supporting resources and sector orientated webinars provides our clients with the most complete picture of the organisations under coverage as is possible. We have been charting and analysing the world’s maritime markets for more than 40 years. This unrivalled intelligence and understanding provides the foundation of our research service. Our analysts have access to one of the most up-to-date, comprehensive and reliable sources of market insight and research data available today. We look at globally listed companies within the following sectors: Port Operators, Container Shipping, Container Manufacturing & Leasing, LNG Shipping, Dry Bulk Shipping and Tanker Shipping. Combine in-depth sector expertise with financial analysis focusing on over 50 stocks globally.

Equity Bottom-Up

<p style="text-align: justify;">SALT reported its 4Q19 results on 27 January 2020 before the market opened. The company reported an operating loss of USD 20.6mn as uncertainties circulating around the implication of the IMO’s 2020 regulations and seasonal weakness took effect. However, the income from equity investments, primarily from Scorpio Tankers, of USD 46.7mn, rescued the company from turning red and ensured a GAAP net income of USD 15.1mn or USD 0.21 per diluted share. Conversely, a major impairment on four vessels of around USD 25.2mn dragged down the net income during the quarter. SALT’s GAAP net loss was USD 7.4mn or USD 0.11 per share for 4Q18. Meanwhile, SALT continues to maintain its dividend payout of USD 0.02 per share. The stock eroded more than 10% of investor wealth in the trading session following the results, despite the overall results beating the consensus estimates.</p>

SALT reported its 4Q19 results on 27 January 2020 before the market opened. The company reported an operating loss of USD 20.6mn as uncertainties circulating around the implication of the IMO’s 2020 regulations and seasonal weakness took effect. However, the income from equity investments, primarily from Scorpio Tankers, of USD 46.7mn, rescued the company from turning red and ensured a GAAP net income of USD 15.1mn or USD 0.21 per diluted share. Conversely, a major impairment on four vessels of around USD 25.2mn dragged down the net income during the quarter. SALT’s GAAP net loss was USD 7.4mn or USD 0.11 per share for 4Q18. Meanwhile, SALT continues to maintain its dividend payout of USD 0.02 per share. The stock eroded more than 10% of investor wealth in the trading session following the results, despite the overall results beating the consensus estimates.

Scorpio Bulkers (NYSE: SALT): Profitability Fails to Sustain Investor Sentiment

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Scorpio Bulkers (NYSE: SALT): Profitability Fails to Sustain Investor Sentiment