Dampskibsselskabet Torm A/S (ADR) (NASDAQ:TRMD)

BuffetsBitch (< 20) Submitted: 3/10/2011 1:02:07 AM

Recs: 0

I'd urge caution here - 2010 results today may well underdeliver - this stock should fall before it gains on product market improvements (which are still some way off).

Forward P/E looks attractive but prices in significant recovery of rates to well above levels in 2009 and 2010.
Assets on balance sheet overvalued on mark-to-market basis (but typical of tanker companies currently).
Liquidity overhang on DKK stock as 52% effectively controlled by same person.
Significant management upheaval in April 2010 has led to many important business drivers leaving for competitors.

Oil price does not necessarily directly affect product tanker rates, although increasing value of cargo will make freight a smaller component of trade costs. Product tankers move generally clean products so more important are refining economics and arbitrage opportunities globally. Increasing dislocation of source of product and end market will help over next 5 years plus, but market is oversupplied with product tankers at present and more still being delivered in 2011/2.

I'd short this today, before results - current price $6.95 then look to come back in further down the curve. There should be significant value if investing in 6-12 months time but keep a watching brief on the product tanker freight rate environment before ploughing in...

BuffetsBitch (< 20) Submitted: 3/10/2011 1:04:17 AM

Recs: 1

I'd urge caution here - 2010 results today may well underdeliver - this stock should fall before it gains on product market improvements (which are still some way off).

Forward P/E looks attractive but prices in significant recovery of rates to well above levels in 2009 and 2010.
Assets on balance sheet overvalued on mark-to-market basis (but typical of tanker companies currently).
Liquidity overhang on DKK stock as 52% effectively controlled by same person.
Significant management upheaval in April 2010 has led to many important business drivers leaving for competitors.

Oil price does not necessarily directly affect product tanker rates, although increasing value of cargo will make freight a smaller component of trade costs. Product tankers move generally clean products so more important are refining economics and arbitrage opportunities globally. Increasing dislocation of source of product and end market will help over next 5 years plus, but market is oversupplied with product tankers at present and more still being delivered in 2011/2.

I'd short this today, before results - current price $6.95 then look to come back in further down the curve. There should be significant value if investing in 6-12 months time but keep a watching brief on the product tanker freight rate environment before ploughing in...

marcin97 (< 20) Submitted: 3/10/2011 5:23:48 PM

Recs: 0

I'm long on TMRD but your post was spot on. Huge drop today after announcement. Wish I have read your post this morning - but probably would not sell my shares anyway. I am thinking if averaging down makes sense now.

JPAKolypse86 (< 20) Submitted: 6/30/2011 11:34:54 AM

Recs: 0

That guys name cracks me up