SFL (NYSE:SFL) Issues Quarterly Earnings Results, Beats Expectations By $0.18 EPS

Key Points

• SFL beat earnings expectations, reporting $0.20 EPS versus the expected $0.02 and revenue of $174.48 million, topping estimates of $169.21 million. Revenue was still down 6.8% year over year.
• The company raised its quarterly dividend to $0.22 per share, its 89th straight quarterly dividend, representing a 10% increase from the prior quarter.
• Management highlighted strong cash generation and backlog growth, including about $170 million of new backlog from a Hercules drilling rig contract and more than $280 million in available liquidity.

SFL (NYSE:SFL - Get Free Report) announced its earnings results on Tuesday. The shipping company reported $0.20 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.02 by $0.18, FiscalAI reports. The company had revenue of $174.48 million during the quarter, compared to analyst estimates of $169.21 million. SFL had a negative net margin of 3.61% and a negative return on equity of 0.30%. The firm's quarterly revenue was down 6.8% compared to the same quarter last year. During the same period in the previous year, the business posted ($0.24) earnings per share.

Here are the key takeaways from SFL's conference call:

• SFL raised its quarterly dividend to $0.22 per share, marking its 89th consecutive quarterly dividend and a 10% increase from the prior quarter.
• The company reported $174 million in revenue, $108 million of adjusted EBITDA, and $26 million in net income for Q1, while emphasizing stable cash generation and a strong backlog.
• SFL added about $170 million of backlog with a new Hercules drilling rig contract starting in Canada in Q1 2027, strengthening long-term earnings visibility for the energy segment.
• The company said its tanker exposure is benefiting from an exceptionally strong spot market, with the two Suezmax vessels generating higher cash flow than the prior four-vessel charter arrangement and management looking for longer-term follow-on charters.
• SFL ended the quarter with over $280 million of available liquidity, refinanced rig facilities on favorable terms, and completed a $75 million bond tap; it also plans to redeem its $150 million 2029 bonds with existing liquidity.

SFL Price Performance

Shares of SFL traded up $0.56 during mid-day trading on Tuesday, reaching $12.56. The stock had a trading volume of 1,080,763 shares, compared to its average volume of 1,474,657. The firm has a market cap of $1.82 billion, a price-to-earnings ratio of -62.73 and a beta of 0.42. SFL has a 12 month low of $6.73 and a 12 month high of $12.72. The business has a fifty day moving average of $10.90 and a 200 day moving average of $9.28. The company has a debt-to-equity ratio of 2.04, a quick ratio of 0.35 and a current ratio of 0.36.

SFL Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Monday, March 30th. Shareholders of record on Thursday, March 12th were given a $0.20 dividend. This represents a $0.80 dividend on an annualized basis and a dividend yield of 6.4%. The ex-dividend date was Thursday, March 12th. SFL's dividend payout ratio is presently -400.00%.

Analyst Upgrades and Downgrades

Several analysts recently issued reports on SFL shares. Wall Street Zen upgraded shares of SFL from a "sell" rating to a "hold" rating in a research report on Sunday, May 3rd. Weiss Ratings restated a "hold (c-)" rating on shares of SFL in a research report on Friday, May 1st. Finally, BTIG Research boosted their target price on shares of SFL from $11.00 to $12.00 and gave the company a "buy" rating in a research report on Wednesday, February 11th. One investment analyst has rated the stock with a Buy rating and one has assigned a Hold rating to the company. According to data from MarketBeat, the stock currently has a consensus rating of "Moderate Buy" and a consensus target price of $12.00.

Hedge Funds Weigh In On SFL

Several hedge funds have recently modified their holdings of the stock. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. lifted its holdings in shares of SFL by 3.5% in the third quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 2,904,433 shares of the shipping company's stock worth $21,870,000 after buying an additional 97,689 shares in the last quarter. Goldman Sachs Group Inc. lifted its holdings in shares of SFL by 16.0% in the fourth quarter. Goldman Sachs Group Inc. now owns 1,259,801 shares of the shipping company's stock worth $9,839,000 after buying an additional 174,072 shares in the last quarter. Empowered Funds LLC lifted its holdings in shares of SFL by 15.1% in the fourth quarter. Empowered Funds LLC now owns 660,013 shares of the shipping company's stock worth $5,155,000 after buying an additional 86,339 shares in the last quarter. Charles Schwab Investment Management Inc. lifted its holdings in shares of SFL by 4.9% in the fourth quarter. Charles Schwab Investment Management Inc. now owns 509,232 shares of the shipping company's stock worth $3,977,000 after buying an additional 23,937 shares in the last quarter. Finally, Voloridge Investment Management LLC lifted its holdings in shares of SFL by 25.0% in the fourth quarter. Voloridge Investment Management LLC now owns 295,668 shares of the shipping company's stock worth $2,309,000 after buying an additional 59,141 shares in the last quarter. Hedge funds and other institutional investors own 28.59% of the company's stock.

SFL Company Profile

Ship Finance International Limited NYSE: SFL is an independent owner of modern, large-size ocean-going vessels that provides finance and leasing services to the global shipping industry. The company’s fleet encompasses a diversified mix of crude oil tankers, product and chemical tankers, liquefied natural gas (LNG) carriers, dry bulk carriers, container vessels and floating production storage and offloading (FPSO) units. By structuring long-term charter agreements and bareboat leases with major oil companies, commodity traders and offshore operators, Ship Finance International seeks to deliver stable cash flows and risk-adjusted returns for its shareholders.

In its core business, Ship Finance International acquires or finances vessels through forward sales agreements and then charters them out under fixed-rate contracts, typically ranging from five to 20 years in duration.

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