Frontline (NYSE:FRO) Trading Down 6.7% - Here's Why

Key Points

• Frontline shares fell 6.7% on Thursday, trading as low as $36.24 after closing at $38.46, with volume well below average.
• Analyst sentiment is mixed: several firms recently downgraded the stock to Hold, while others raised ratings and price targets. MarketBeat shows a consensus rating of Hold with a $41.62 price target.
• The company posted strong quarterly revenue growth of 66.9% year over year, but EPS of $1.55 slightly missed estimates. Frontline also raised its quarterly dividend to $1.55 per share, implying a very high annualized yield of 17.1%.

Frontline PLC (NYSE:FRO - Get Free Report)'s stock price was down 6.7% on Thursday . The company traded as low as $36.24 and last traded at $35.8960. 390,203 shares were traded during mid-day trading, a decline of 89% from the average daily volume of 3,550,838 shares. The stock had previously closed at $38.46.

Wall Street Analyst Weigh In

Several analysts have issued reports on the company. Pareto Securities downgraded Frontline from a "buy" rating to a "hold" rating and set a $39.46 price objective on the stock. in a report on Monday, May 25th. Danske cut shares of Frontline to a "hold" rating in a report on Tuesday, May 26th. Weiss Ratings raised shares of Frontline from a "hold (c+)" rating to a "buy (b)" rating in a research report on Friday, May 22nd. BTIG Research boosted their price target on shares of Frontline from $45.00 to $55.00 and gave the company a "buy" rating in a report on Wednesday, June 24th. Finally, Wall Street Zen upgraded shares of Frontline from a "buy" rating to a "strong-buy" rating in a research report on Saturday, June 27th. Four analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company. Based on data from MarketBeat.com, Frontline currently has a consensus rating of "Hold" and a consensus price target of $41.62.

Frontline Stock Down 5.8%

The company has a quick ratio of 2.03, a current ratio of 2.03 and a debt-to-equity ratio of 0.83. The firm has a market capitalization of $8.06 billion, a PE ratio of 8.92 and a beta of 0.01. The business's 50-day moving average price is $37.30 and its 200-day moving average price is $32.94.

Frontline (NYSE:FRO - Get Free Report) last announced its quarterly earnings data on Friday, May 22nd. The shipping company reported $1.55 EPS for the quarter, missing analysts' consensus estimates of $1.58 by ($0.03). The company had revenue of $714.24 million for the quarter, compared to analysts' expectations of $579.59 million. Frontline had a net margin of 36.70% and a return on equity of 27.80%. The business's revenue for the quarter was up 66.9% on a year-over-year basis. During the same period in the previous year, the firm posted $0.18 earnings per share.

Frontline Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Tuesday, June 23rd. Investors of record on Friday, June 12th were given a dividend of $1.55 per share. The ex-dividend date of this dividend was Friday, June 12th. This is a positive change from Frontline's previous quarterly dividend of $1.03. This represents a $6.20 dividend on an annualized basis and a yield of 17.1%. Frontline's payout ratio is 152.71%.

Institutional Investors Weigh In On Frontline

Institutional investors have recently made changes to their positions in the company. Melqart Asset Management UK Ltd acquired a new stake in Frontline in the third quarter valued at approximately $437,000. UBS Group AG raised its holdings in shares of Frontline by 18.2% during the 4th quarter. UBS Group AG now owns 1,411,265 shares of the shipping company's stock valued at $30,794,000 after purchasing an additional 217,760 shares in the last quarter. Leonteq Securities AG bought a new position in shares of Frontline during the 4th quarter valued at $362,000. MQS Management LLC acquired a new stake in shares of Frontline in the 4th quarter valued at $494,000. Finally, Vanguard Group Inc. lifted its stake in shares of Frontline by 1.1% in the 4th quarter. Vanguard Group Inc. now owns 5,903,785 shares of the shipping company's stock valued at $129,966,000 after purchasing an additional 63,432 shares during the last quarter. 22.70% of the stock is currently owned by institutional investors and hedge funds.

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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