NYSE:FRO

Stock Analysis Report

Executive Summary

Frontline Ltd., a shipping company, engages in the seaborne transportation of crude oil and oil products worldwide.

Snowflake

Fundamentals

High growth potential and fair value.


Similar Companies

Share Price & News

How has Frontline's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

3.0%

FRO

1.7%

US Oil and Gas

1.0%

US Market


1 Year Return

74.0%

FRO

-21.2%

US Oil and Gas

6.7%

US Market

Return vs Industry: FRO exceeded the US Oil and Gas industry which returned -21.2% over the past year.

Return vs Market: FRO exceeded the US Market which returned 6.7% over the past year.


Share holder returns

FROIndustryMarket
7 Day3.0%1.7%1.0%
30 Day24.4%-3.7%-1.8%
90 Day37.4%-8.3%-1.8%
1 Year74.0%74.0%-18.3%-21.2%9.1%6.7%
3 Year63.0%53.0%-5.7%-14.1%46.1%36.6%
5 Yearn/a-21.8%-32.6%66.9%48.6%

Price Volatility Vs. Market

How volatile is Frontline's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Frontline undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Undervalued: FRO ($11.43) is trading below our estimate of fair value ($126.01)

Significantly Undervalued: FRO is trading below fair value by more than 20%.


Price Based on Earnings

PE vs Industry: FRO is poor value based on its PE Ratio (28.2x) compared to the Oil and Gas industry average (9.9x).

PE vs Market: FRO is poor value based on its PE Ratio (28.2x) compared to the US market (17.5x).


Price Based on Expected Growth

Low PEG Ratio: FRO is good value based on its PEG Ratio (0.6x)


Price Based on Value of Assets

PB vs Industry: FRO is overvalued based on its PB Ratio (1.6x) compared to the US Oil and Gas industry average (0.9x).


Next Steps

Future Growth

How is Frontline expected to perform in the next 1 to 3 years based on estimates from 9 analysts?

48.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: FRO's forecast earnings growth (48.3% per year) is above the savings rate (2.7%).

Earnings vs Market: FRO's earnings (48.3% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: FRO's revenue (11.6% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: FRO's revenue (11.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: FRO's Return on Equity is forecast to be high in 3 years time (23%)


Next Steps

Past Performance

How has Frontline performed over the past 5 years?

-49.4%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: FRO's earnings have declined by -49.4% per year over the past 5 years.

Accelerating Growth: FRO has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: FRO has become profitable in the last year, making it difficult to compare its past year earnings growth to the Oil and Gas industry (22.6%).


Return on Equity

High ROE: FRO's Return on Equity (5.7%) is considered low.


Return on Assets

ROA vs Industry: FRO's Return on Assets is below or equal to the Oil and Gas industry average last year.


Return on Capital Employed

ROCE Improving: FRO's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Frontline's financial position?


Financial Position Analysis

Short Term Liabilities: FRO's short term assets ($293.7M) exceeds its short term liabilities ($237.9M)

Long Term Liabilities: FRO's short term assets (293.7M) do not cover its long term liabilities (1.7B)


Debt to Equity History and Analysis

Debt Level: FRO's debt to equity ratio (144.2%) is considered high

Reducing Debt: FRO's debt to equity ratio has increased from 43.7% to 144.2% over the past 5 years.

Debt Coverage: FRO's debt is not well covered by operating cash flow (9.9%).

Interest Coverage: FRO's interest payments on its debt are not well covered by EBIT (1.8x coverage).


Balance Sheet

Inventory Level: FRO has a high level of physical assets or inventory.

Debt Coverage by Assets: FRO's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

What is Frontline's current dividend yield, its reliability and sustainability?

2.19%

Expected Dividend Yield


Dividend Yield vs Market

company0%marketbottom25%1.5%markettop25%3.8%industryaverage3.9%forecastin3Years2.2%

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: Unable to evaluate FRO's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate FRO's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if FRO's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if FRO's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: FRO is not paying a notable dividend for .


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of FRO's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Frontline's salary, the management and board of directors tenure and is there insider trading?

7.8yrs

Average management tenure


CEO

John Fredriksen (75yo)

21.9yrs

Tenure

0

Mr. John Fredriksen has served as the Chairman of the Board, President and Director of Frontline Ltd. since November 3, 1997 and served as its Chief Executive Officer. Mr. Fredriksen is a Founder of World  ...


Management Age and Tenure

7.8yrs

Average Tenure

55yo

Average Age

Experienced Management: FRO's management team is seasoned and experienced (7.8 years average tenure).


Board Age and Tenure

2.8yrs

Average Tenure

62.5yo

Average Age

Experienced Board: FRO's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$23,636,69106 Jun 19
Greenwich Holdings Ltd.
EntityCompany
Shares3,000,000
Max PriceUS$7.88

Ownership Breakdown


Management Team

  • John Fredriksen (75yo)

    Chairman of the Board & President

    • Tenure: 21.9yrs
  • Inger Klemp (55yo)

    Principal Financial Officer

    • Tenure: 7.8yrs
  • Robert Macleod (39yo)

    Chief Executive Officer of Frontline Management AS

    • Tenure: 4.9yrs

Board Members

  • John Fredriksen (75yo)

    Chairman of the Board & President

    • Tenure: 21.9yrs
  • Ola Lorentzon (70yo)

    Director

    • Tenure: 4.4yrs
  • James O'Shaughnessy (55yo)

    Director

    • Tenure: 1.1yrs
  • Ulrika Laurin (48yo)

    Director

    • Tenure: 1.1yrs

Company Information

Frontline Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Frontline Ltd.
  • Ticker: FRO
  • Exchange: NYSE
  • Founded:
  • Industry: Oil and Gas Storage and Transportation
  • Sector: Energy
  • Market Cap: US$2.251b
  • Shares outstanding: 196.89m
  • Website: https://www.frontline.bm

Number of Employees


Location

  • Frontline Ltd.
  • Par-la-Ville Place
  • 14 Par-la-Ville Road
  • Hamilton
  • HM 08
  • Bermuda

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
FRONYSE (New York Stock Exchange)YesOrdinary SharesUSUSDMay 1998
FROOB (Oslo Bors)YesOrdinary SharesNONOKMay 1998
FRLNDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMay 1998
FRO NBMV (Bolsa Mexicana de Valores)YesOrdinary SharesMXMXNMay 1998
FROOBATS-CHIXE (BATS 'Chi-X Europe')YesOrdinary SharesGBNOKMay 1998
0REHLSE (London Stock Exchange)YesOrdinary SharesGBNOKMay 1998

Biography

Frontline Ltd., a shipping company, engages in the seaborne transportation of crude oil and oil products worldwide. It owns and operates oil and product tankers. As of August 13, 2019, the company owned an ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 01:25
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

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