Stolt-Nielsen posted its 3Q25 (June-August) report with results being in line with consensus and stronger than we expected. Geopolitical uncertainty and macro-economic events continue to create headwinds for the chemical industry. However, the company expects tanker product market to remain firm through FY25 and narrowed the EBITDA guidance for 2025 to USD 750-790m (USD 740-810m previously). We believe the company can withstand the ongoing uncertainty and, following the recent share weakness, upgrade our recommendation to Buy raising TP to NOK 375/sh.

Figures have beaten our estimates
Stolt-Nielsen has delivered a quarterly EBITDA of USD 196m, exceeding our and consensus expectations. The bottom line of USD 64m is in line with consensus, while surpassing our estimate. Tankers EBITDA fell 27% from the same quarter last year, while the other areas of operations delivered an increase in EBITDA of 13%, diluting the impact of softer shipping markets. TCE earnings dropped by 26% to USD 24,838 per day, versus record levels in the same quarter last year. During the quarter, SSF combined with Corporate & Other segments delivered EBIT of USD 14.2m compared with a loss of USD 11.8m in the same quarter last year. This was driven by improved results in SSF and Avenir.

USTR fees pose a unique challenge for the seaborne trade
SNI’s entire fleet is complaint with USTR, meaning no fees are incurred whilst trading in and out of the United States. Albeit, other shipping operators, that are not in such position, seem to be ramping up volatility in other trades not related to the U.S. causing downward pressure in the whole shipping industry. Notably, supply might be impacted on US related trade routes as Chinese owners retrench from their trades. However, 12% of SNI’s fleet is eligible for retirement if necessary to manage supply risks.

Uncertainty continues, causing volatility throughout the industry
Geopolitical uncertainty and macro-economic events continue to create headwinds for the chemical industry at large, causing ongoing high volatility. On the supply side, SNI expects the MR rates to remain firm through the end of this year, limiting the impact of swing tonnage. The company narrowed the EBITDA guidance for 2025 to USD 750-790m from USD 740-810m previously, leaving 4Q25 EBITDA range of USD 168-208m. Our forecasted EBITDA of USD 185m is around midpoint of the threshold.

Navigating through uncertainty
The stock dropped after the report, which we believe was driven by uncertainty related to tariffs and the broader volatility in the shipping industry caused by USTR port fees. SNI’s business model combined with seemingly stable MR rates, limiting swing tonnage and fleet flexibility, should provide some stability with the uncertain environment. Thus, we upgrade our recommendation to Buy at a higher TP NOK 375/sh (360).
Source: Norne Research