TORM plc Price Performance and Earnings Growth Outpaces Its Competitors

TORM plc, Inc. (TRMD) is a London-based global carrier of energy and clean petroleum products with a market cap of $2.81 billion that has been trading on the Nasdaq since mid-2018. Their fleet of product tankers transports gasoline, naphtha, diesel, and jet and fuel oil that keep businesses across the world operating efficiently, safely, and reliably every day. The company was founded in Denmark in 1889 and now operates over 80 modern vessels that focus on providing stringent safety and environmental outcomes. Their ships range in size from 45,000 to 114,000 DWT. The company has 3500 dedicated employees. Companies related to TORM include Teekaly Tankers LTD (TNK), DHT Holdings, Inc. (DHT), Frontline plc (FRO), and Dorian LPG Ltd (LPG).

The company reported its latest financial results on March 16, 2023 for the full year 2022, and latest quarter in 2022. EPS of $4.45 beat the target by $1.63 and the revenue of $444.4 million (135% year-over- year) beat its $105.5 target as well. Total EBITDA for FY 2022 was $743 million of which $557 million was the profit before taxes. The European Union ban on Russian oil products was the most important factor in driving the demand for the company’s services.

TRMD has an extremely low P/E ratio of 4.67, well below that of average VectorVest stock at 45.16, and very appealing to conservative investors. Moreover, it has forecasted earnings per share of $7.44 for the year ahead. The average daily trading volume of nearly 291,000 shares certainly is sufficient for obtaining favorable trade executions. And 80% of its shares are held by institutions. According to Morningstar TRMD has a forward annual dividend yield of 9.2% with a dividend rate of $2.92.

VectorVest ranks TRMD #1 in its universe of 278 petroleum companies, as well as #1 out of 26 stocks in the Petroleum (Product/Pipeline) industry group. That is quite a dual-barreled accomplishment. These high rankings are understandable with its strong 26%sales growth of over the past year, and its solid historical earnings growth. Moreover, its massive sales growth of 188% per year is another indication that this company is powering ahead on all cylinders.

Currently, the stock price is well above the critical 40-day moving average which is not the case for the three major stock market averages. The stock has had a great run from its recent low on March 9, 2022, at $9.23 to its all-time high on March 18, 2023 of $36.60, a run up of 297%, while the S&P 500 Index by comparison actually lost 0.01%. Thus, being in best performing market segments, such as petroleum products and pipelines, is critically important to portfolio performance. That is where VectorVest excels, and runs rings against its competitors. With a few mouse clicks, the Stock Viewer pinpoints the top stocks comparing all stocks against each other, bringing the leaders to the top of the screen for further analysis and a technical chart review.

TRMD’s High VectorVest Scores Pinpoint a Potential Exceptional Opportunity

The VectorVest ratings of TORM are as follows:

• Excellent Upside Potential: The Relative Value (RV) rating focuses on a stock’s long-term, three-year price appreciation potential. The current RV rating for TRMD is 1.63 which is much higher than average on a scale of 0.00-2.00. VectorVest’s current value of this stock is $49.33 that is significantly higher than its current price of 34.70; therefore it is considered undervalued with room to exceed its recent high.
• Fair Safety: The Relative Safety (RS) rating is based on the company’s business longevity, financial predictability/consistency, debt-to-equity ratio, and additional risk parameters, including price volatility. The RS rating of 0.90 is below average, indicating above average risk.
• Excellent Good Timing: The Relative Timing (RT) rating focuses on the price trend over the short, medium, and long term. The components include price direction, dynamics, and price magnitude of price changes over daily, weekly, quarterly, and yearly comparisons. TRMD has a significantly high RT rating of 1.58 compared to the average 0.81 RT of all the stocks in the database. Also, the chart’s MACD indicator was in an uptrend until March 3, but has ticked down the last 10 days, in sympathy with the market decline.
• Excellent Comfort Index: This index measures the consistency of a stock’s long-term resistance to severe and lengthy corrections. This index compares the individual stock to the fluctuation of the VectorVest Composite price that is measured on a scale of 0 to 2.00. At a level of 1.85 TRMD’s rating is notably well above average. Therefore, this stock is certainly suitable for all types of investors.
• Excellent Growth Rate (GRT): TRMD’s extraordinary 46% forecasted growth rate is measured over a forecasted three-year period. This fundamental factor is calculated in the VectorVest software, so you don’t have to do the work. The chart below highlights its up trending earnings with a consistent step-up after every earnings release.
• Very Good VST Score: The VST Master Indicator ranks 9139 stocks from high to low and brings to the top of the rankings those stocks with the highest VST scores. TRMD’s high score of 1.41 places it in the upper three -tenths of 1% of the entire database which is rarefied territory. Using VST enables users to identify stocks that are performing much better than average, as well as the opportunity to find the cream of the crop in all its critical criteria with a few mouse clicks. This stock is definitely in that category.

Considering the exceptional VectorVest scores and its positive earnings trend, this may be a good time to buy TRMD, as it is only two weeks off its all-time high of $36.60. The current stock price is 7.3% below that price. First, make sure that you check out VectorVest’s overall market timing signal, additional TRMD stock ratings, and its buy, sell or hold recommendation before making a purchase. To see TRMD’s current recommendation analyze it free using VectorVest.

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