Viking Supply Ships (OM:VSSAB B): Losses Cut by 49% Annually, Shares Trade Far Below DCF Value

Viking Supply Ships (OM:VSSAB B) remains unprofitable but has consistently narrowed its losses over the past five years, averaging a reduction of 49.3% per year. With no recent revenue or profit growth data available, investors are left to weigh the significance of ongoing improvements in loss reduction against the company's lack of profitability.

See our full analysis for Viking Supply Ships.

Next, we will put these results in context by comparing them to the most popular narratives investors are following. We will find out which perspectives these earnings support and which ones may need to be reconsidered.

Curious how numbers become stories that shape markets? Explore Community Narratives

Losses Narrow by Nearly Half Each Year

• Viking Supply Ships has reduced its losses at an average rate of 49.3% per year over the last five years. This marks a notable trend of improvement in its bottom line even though the company remains unprofitable.
• What is surprising is that, despite not turning a profit yet, the company’s persistent cost control and focus on loss reduction stand out as a positive signal, especially considering that no notable risks have been flagged and one reward points to good overall value.
  • This progress challenges concerns that ongoing losses would significantly worsen financial health, since the pace of loss reduction is substantial rather than marginal.
  • The ability to halve losses year after year suggests management is making measurable operational improvements, not just temporary fixes.

Share Price Trades Below DCF Fair Value

• With the current share price at SEK114.5 compared to a DCF fair value estimate of SEK876.08, the stock is trading at a substantial discount of nearly 87% below what discounted cash flow calculations indicate it could be worth.
• The prevailing narrative notes that this wide discount to fair value, combined with narrowing losses, heavily supports the view that the stock’s poor profitability is already more than reflected in today’s valuation.
  • While some investors may be discouraged by unprofitability, the market appears to be discounting the company sharply, leaving room for upside if loss reduction trends continue.
  • This valuation gap stands out, even considering the company’s price-to-sales ratio is higher than the European industry average, hinting that value-focused investors could see opportunity as financial progress continues.

Price-to-Sales Premium vs. Industry, But Peer Average

• Viking Supply Ships trades at a price-to-sales ratio of 2x, which is markedly higher than the European shipping industry average of 0.8x, but aligns closely with its immediate peer group. This suggests mixed signals on relative value.
• Analysis indicates this premium versus the wider industry sits alongside the stock’s unusually large discount to DCF fair value, pointing to a nuanced valuation picture where the market may favor sector resilience or peer group dynamics, even amid ongoing losses.
  • This combination challenges the narrative that a high price-to-sales ratio alone means the stock is overvalued, since the deep discount to DCF fair value tells a different story.
  • It also hints that the peer group, likely facing similar sector headwinds, has valuations that factor in both current challenges and prospects for operational turnaround.

Next Steps

Don't just look at this quarter; the real story is in the long-term trend. We've done an in-depth analysis on Viking Supply Ships's growth and its valuation to see if today's price is a bargain. Add the company to your watchlist or portfolio now so you don't miss the next big move.

See What Else Is Out There

Despite progress in narrowing losses, Viking Supply Ships remains unprofitable and lacks consistent revenue or earnings growth. This raises concerns for investors seeking stability.

If you want to prioritize consistent performers, check out stable growth stocks screener (2096 results) to discover companies that deliver steady growth and smoother financial results across market cycles.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com