Business Overview
Founded in 2005, DHT Holdings, Inc. (NYSE: DHT) is an independent crude oil tanker company that owns and operates a fleet of 26 modern Very Large Crude Carriers (VLCCs) that is designed to transport huge volumes of oil across the globe, including the Middle East to China and US Gulf to Asia.
DHT Holdings business model allows them to earn revenue in two main ways that consisted of:
- Spot Market Voyages: Short-term trips at current high rates when oil demands suddenly spikes. Spot Market Voyages positioned them for market upside - riskier but higher paydays.
- Time Charters: Longer contracts with fixed daily rates for steadier and more consistent income.
DHT Holdings, Inc. maintains a high degree of spot market exposure compared to its peers, with management explicitly stating a target of approximately 70-75% spot market voyages exposure by Q2 2026. DHT has positioned themselves to capture upside and maximize earnings during rate spikes amid geopolitical factors like the we are currently facing.
Catalyst: US-Israel vs Iran military conflict and Iran's threats to disrupt the Strait of Hormuz
Starting February 28 2026, The escalation of US-Israel strikes on Iran, including the assasination of Iran's Supreme Leader, Khamenei. This have triggered Iranian retaliation which include effective disruptions or closures in the Strait of Hormuz that serves as a vital chokepoint for global oil trade, handling about 25% of the world's crude oil trade. The disruptions have effectively halted any traffic through the Strait of Hormuz, causing VLCCs spot rates to spike as high as $400,000+ per day as of March 2026.
In simple terms, blocked strait = trapped ships + panic chartering / frantic booking by importers + forced rerouting adding extra demand and thousand of miles to voyages = sky-high rates.
Competitive Advantages: Why DHT holdings could outperform crude oil, defense stocks and gold ?
Most investors trading the US-Iran war are most likely buying the same stock which is crude oil, defense and gold. However, traditional safe havens like Oil (Brent & WTI) and Gold have already rallied around 20% YTD. Defense stock (Lockheed Martin & Northrop Grumman) has also rallied more than 35% since the beginning of this year.
While DHT Holdings, Inc. stock price is currently up more than 60% YTD, this happens before the assasination of Iran's supreme leader and disruption in the Strait of Hormuz. The Strait of Hormuz remains the world's most critical oil chokepoint, positioning DHT to capture upside from sustained high VLCC rates if disruptions or closures persist longer.
Additionally, it is worth noting that VLCC earnings flow almost directly to EBITDA and free cash flow since operating costs are relatively fixed.
Growth Assumptions & Fair Value / Price Target
Short term (3-6 Months Timeline, assuming US-Iran tensions persist)
Data used for Assumption
- DHT recently locked in one-year charters for several of their fleets at over $100,000/day, rates not seen in decades due to panic chartering and high demand of oil around the globe [2].
- As reported on February 2026, Q1 2026 averaged $78.9k/day across 76% of spot fleet [3].
- Current escalation in US-Iran war caused rate to spike, reaching as high as $400k/day
- Q4 2025 Earnings Report:
- Fleet TCE Revenue Days: 1,955.5 days
- Average TCE: $60,300/day
- Total Revenue: $117.8M
- Net Income: $66.1M
- EPS: $0.41 (160.8M shares outstanding)
Base Case - Tensions persist and disruption in the Strait of Hormuz persist, average $90k/day TCE
Q2 2026 TCE uplift vs Q4 2025 = +$29.7k
Q2 2026 additional Revenue = +$58.1M
Q2 2026 additional Net Income = (66.1 / 117.8) x 58.1 = +$32.6M
Increase in Earning per Share (EPS) = ~ $0.2
Total Q2 Earnings per Share (EPS) = $0.61
Annualized Earning per Share (EPS) = $2.44
DHT Holdings, Inc. Fair Value based on VLCCs Companies Multiple Comparison (As of March 2026)
At a 10x Multiple (conservative trough-cycle trading), the fair value of DHT Holdings, Inc would be $24.4, approximately 30% gain from current price.
Fair Value = Annualized Earnings per Share x Average Industry Multiples
Fair Value = $2.44 x 14.8 = ~$36
Calculated using the Peer Multiple Method, the fair value of DHT Holdings, Inc would be sitting around $36, which is approximately 95% gain from current price.
Additional Resources / Reports
Have other thoughts on DHT Holdings?
Create your own narrative on this stock, and estimate its Fair Value using our Valuator tool.
Create NarrativeHow well do narratives help inform your perspective?
Disclaimer
The user GavrielH holds no position in NYSE:DHT. Simply Wall St has no position in any of the companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The author of this narrative is not affiliated with, nor authorised by Simply Wall St as a sub-authorised representative. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimates are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
