Frontline (NYSE:FRO) Shares Gap Up - Time to Buy?

Key Points

• Shares gapped up — Frontline opened at $35.87 vs a prior close of $34.16 and was trading up about 4.3% with ~523,101 shares changing hands; MarketBeat’s consensus target is $38.00.
• Analysts are mixed but leaning positive: notable upgrades (Clarkson Capital, BTIG raised its PT to $42) and downgrades (Piper Sandler, Dnb Carnegie) leave the stock with four Buy and three Hold ratings for a consensus of Moderate Buy.
• Fundamentals show a missed EPS ($1.03 vs. $1.13 estimate) but a strong revenue beat ($624.5M vs. $456.9M, +46.7% YoY), and Frontline recently boosted its quarterly dividend to $1.03 (annualized $4.12) for a yield of 11.6% with a payout ratio of 242%.

Frontline PLC (NYSE:FRO - Get Free Report)'s stock price gapped up prior to trading on Wednesday . The stock had previously closed at $34.16, but opened at $35.87. Frontline shares last traded at $35.8870, with a volume of 523,101 shares changing hands.

Analyst Ratings Changes

Several analysts have weighed in on the company. Clarkson Capital raised Frontline from a "neutral" rating to a "buy" rating in a report on Monday, January 12th. Piper Sandler cut Frontline to a "neutral" rating in a report on Friday, February 27th. BTIG Research raised their price objective on Frontline from $35.00 to $42.00 and gave the company a "buy" rating in a report on Friday, February 27th. Dnb Carnegie cut Frontline from a "strong-buy" rating to a "hold" rating in a report on Monday, March 2nd. Finally, Wall Street Zen raised Frontline from a "hold" rating to a "buy" rating in a report on Saturday, April 4th. Four equities research analysts have rated the stock with a Buy rating and three have issued a Hold rating to the company's stock. Based on data from MarketBeat, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $38.00.

Frontline Trading Up 4.3%

The company has a market capitalization of $7.93 billion, a PE ratio of 20.95 and a beta of 0.05. The company has a current ratio of 1.43, a quick ratio of 1.19 and a debt-to-equity ratio of 1.09. The stock has a fifty day moving average of $33.64 and a two-hundred day moving average of $27.34.

Frontline (NYSE:FRO - Get Free Report) last announced its quarterly earnings data on Saturday, February 28th. The shipping company reported $1.03 earnings per share for the quarter, missing analysts' consensus estimates of $1.13 by ($0.10). The firm had revenue of $624.51 million for the quarter, compared to analysts' expectations of $456.90 million. Frontline had a net margin of 19.31% and a return on equity of 16.51%. The business's quarterly revenue was up 46.7% on a year-over-year basis. During the same period in the prior year, the business posted $0.20 earnings per share. As a group, sell-side analysts anticipate that Frontline PLC will post 1.78 earnings per share for the current fiscal year.

Frontline Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Thursday, March 19th. Investors of record on Thursday, March 12th were issued a dividend of $1.03 per share. The ex-dividend date of this dividend was Thursday, March 12th. This represents a $4.12 dividend on an annualized basis and a dividend yield of 11.6%. This is a positive change from Frontline's previous quarterly dividend of $0.19. Frontline's payout ratio is 242.35%.

Hedge Funds Weigh In On Frontline

A number of large investors have recently bought and sold shares of FRO. Voloridge Investment Management LLC purchased a new position in Frontline in the 4th quarter worth approximately $15,676,000. Balyasny Asset Management L.P. increased its stake in Frontline by 44.0% in the 3rd quarter. Balyasny Asset Management L.P. now owns 2,247,120 shares of the shipping company's stock worth $51,212,000 after purchasing an additional 686,212 shares during the period. Barclays PLC increased its stake in Frontline by 256.9% in the 4th quarter. Barclays PLC now owns 826,343 shares of the shipping company's stock worth $18,031,000 after purchasing an additional 594,811 shares during the period. Forest Avenue Capital Management LP purchased a new position in Frontline in the 4th quarter worth approximately $11,917,000. Finally, Skandinaviska Enskilda Banken AB publ increased its stake in Frontline by 882.4% in the 4th quarter. Skandinaviska Enskilda Banken AB publ now owns 583,166 shares of the shipping company's stock worth $12,725,000 after purchasing an additional 523,806 shares during the period. 22.70% of the stock is owned by hedge funds and other institutional investors.

About Frontline

Frontline Ltd. NYSE: FRO is a leading global shipping company specializing in the seaborne transportation of crude oil and petroleum products. The company's core business activities encompass the ownership and operation of very large crude carriers (VLCCs), Suezmax tankers and Aframax vessels. Through long-term charters, spot market operations and time charters, Frontline provides flexible shipping solutions that cater to a diverse set of energy producers, refiners and trading houses worldwide.

Frontline's fleet is geared toward high-capacity, ocean-going tankers capable of carrying large volumes of crude oil over intercontinental distances.

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