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1. Company Snapshot

1.a. Company Description

TORM plc, a product tanker company, engages in the transportation of refined oil products and crude oil worldwide.It operates in two operating segments, Tanker and Marine Exhaust.The company transports gasoline, jet fuel, naphtha, and gas oil, as well as dirty petroleum products, such as fuel oil.


It also engages in developing and producing advanced and green marine equipment.The company was founded in 1889 and is based in London, the United Kingdom.

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1.b. Last Insights on TRMD

TORM plc faces potential negative drivers, including increased share capital through the exercise of Restricted Share Units (RSUs) as part of its incentive program, which may lead to dilution of existing shareholders. The company has increased its share capital by 970,646 A-shares and 2,395,426 shares in recent announcements. Furthermore, Howard Marks' exit from Sitio Royalties Corp may have an indirect impact on TORM's stock. Additionally, the company's fleet expansion and focus on eco-efficient ships may not be enough to offset potential concerns.

1.c. Company Highlights

2. TORM's Q3 2025 Earnings: A Strong Performance

TORM reported a robust Q3 2025 with TCE revenues of $236 million, resulting in an EBITDA of $152 million and a net profit of $78 million. The company's earnings per share (EPS) came in at $4.91, beating analyst estimates of $4.84. The strong financial performance was driven by firm freight rates, supported by a stable market environment and geopolitical tensions, with TCE rates averaging $31,012 per day. The company's LR2 vessels earned above $38,000 per day, while LR1s and MRs achieved rates of around $29,500 and over $28,000 per day, respectively.

Publication Date: Nov -11

📋 Highlights
  • Strong Financial Performance:: TORM reported TCE revenues of $236 million, EBITDA of $152 million, and net profit of $78 million in Q3, with TCE rates averaging $31,012 per day.
  • Fleet Optimization:: Acquired 5 vessels (4 MRs, 1 LR2) and secured a 3-year time charter for TORM Lilly at $22,234/day, while divesting a 2007 MR to modernize the fleet.
  • Guidance Upside:: Raised full-year 2025 TCE guidance midpoint to $900 million (from $875M–$925M) and narrowed EBITDA range to $540M–$590M, reflecting confidence in firm freight rates.
  • Secured Earnings Visibility:: 55% of Q4 earnings days are fixed at $30,156/day, with 89% of 2025 earning days secured at an average TCE of $28,281/day.

Fleet Optimization Strategy

TORM continued to optimize its fleet by acquiring 5 vessels, including 4 MRs and 1 LR2, while divesting a 2007-built MR. The company also secured a 3-year time charter for the 2009-built MR vessel, TORM Lilly, at a daily rate of $22,234. These transactions support TORM's focus on maintaining a modern and high-quality fleet, with Jacob Meldgaard stating that the age of the assets is not a concern as long as they generate the highest return on invested capital.

Financial Position and Guidance

TORM's financial position remains strong, with a broker valuation of its fleet standing at $2.9 billion at quarter-end and net interest-bearing debt at $690 million, corresponding to around 24% of its fleet value. The company has increased the midpoint of its TCE guidance to $900 million and narrowed its EBITDA guidance to $540 million to $590 million. As of October 31, TORM has secured 55% of its Q4 earnings days at an average of $30,156 per day, providing visibility on future earnings.

Valuation and Dividend

TORM's current valuation metrics indicate a relatively attractive position, with a P/E Ratio of 6.91, P/B Ratio of 1.08, and Dividend Yield of 11.02%. The company's dividend payout ratio was increased to 78%, with Kim Balle clarifying that the distribution policy is designed to distribute free liquidity generated throughout the quarter. The current payout level is satisfactory, but the company may consider higher payouts in the future as cash flow breakeven levels decrease.

Outlook and Analyst Estimates

Analysts estimate a revenue growth decline of -11.6% for next year, but TORM's strong performance in the first 3 quarters provides a solid foundation for the remaining part of the year. With 89% of its earning days fixed at an average TCE of $28,281 per day for the full year 2025, the company is well-positioned to navigate the dynamic market environment.

3. NewsRoom

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Stop Waiting for “Rate Cuts.” Here’s How to Build an 8% Yield Portfolio Even if the Fed Holds Rates in December

Dec -04

Source:

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Senior Executives in Dry Bulk, Container, Crude Tanker, Product Tanker, LNG, LPG Shipping to Present in Capital Link Webinar Series

Nov -24

Source:

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Is TORM Still an Opportunity After Fleet Expansion and a 9.5% Share Price Jump?

Nov -20

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Capital Link Shipping Sectors Webinar Series - December 2025

Nov -19

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Howard Marks Exits Sitio Royalties Corp, Impacting Portfolio by -5.04%

Nov -14

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TORM plc capital increase in connection with exercise of Restricted Share Units as part of TORM's incentive program

Nov -14

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TORM plc capital increase in connection with delivery of one LR2 vessel and exercise of Restricted Share Units as part of TORM's incentive program

Nov -12

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TORM (CPSE:TRMD A) Is Up 6.6% After Raising 2025 Outlook and Advancing Fleet Expansion

Nov -11

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.83%)

6. Segments

Tanker

Expected Growth: 4.83%

TORM plc's 4.83% growth in tanker segment is driven by increasing global oil demand, improved fleet utilization, and cost savings from vessel optimization. Additionally, strategic acquisitions and expansion into new markets have contributed to the growth. Furthermore, the company's focus on sustainability and digitalization has enhanced operational efficiency, leading to increased profitability.

Marine Exhaust

Expected Growth: 4.83%

TORM plc's Marine Exhaust segment growth of 4.83% is driven by increasing demand for eco-friendly vessels, stringent emissions regulations, and rising global seaborne trade. Additionally, the company's focus on retrofitting existing vessels with energy-efficient exhaust systems and expanding its product offerings to cater to the growing offshore wind industry also contribute to this growth.

Intersegment Elimination

Expected Growth: 4.83%

TORM plc's 4.83% intersegment elimination growth is driven by increased vessel utilization, improved operational efficiency, and strategic chartering agreements. Additionally, the company's focus on cost reduction initiatives and favorable market conditions have contributed to this growth. The elimination of intersegment revenues and expenses has also enhanced the company's overall profitability.

7. Detailed Products

Tanker Fleet

TORM plc operates a fleet of product tankers, providing transportation services for crude oil, petroleum products, and chemicals.

Ship Management

TORM plc offers ship management services, including technical management, crew management, and commercial management.

Vessel Chartering

TORM plc provides vessel chartering services, connecting ship owners with charterers and facilitating the transportation of goods.

Freight Forwarding

TORM plc offers freight forwarding services, arranging the transportation of goods from origin to destination.

Marine Services

TORM plc provides marine services, including vessel inspection, repair, and maintenance.

8. TORM plc's Porter Forces

Forces Ranking

Threat Of Substitutes

TORM plc operates in a niche market with limited substitutes, but the threat of substitutes is still present due to the possibility of new technologies or innovations that could disrupt the industry.

Bargaining Power Of Customers

TORM plc's customers have limited bargaining power due to the specialized nature of the company's services and the lack of alternative providers.

Bargaining Power Of Suppliers

TORM plc's suppliers have some bargaining power due to the limited number of suppliers in the market, but the company's large scale of operations and diversified supplier base mitigate this risk.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the industry, including the need for specialized equipment and expertise.

Intensity Of Rivalry

The intensity of rivalry in the industry is high due to the presence of several established players and the limited market share available.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 38.90%
Debt Cost 3.95%
Equity Weight 61.10%
Equity Cost 3.37%
WACC 3.59%
Leverage 63.68%

11. Quality Control: TORM plc passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Teekay Tankers

A-Score: 6.9/10

Value: 7.3

Growth: 8.2

Quality: 7.5

Yield: 7.0

Momentum: 6.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
International Seaways

A-Score: 6.7/10

Value: 7.2

Growth: 8.2

Quality: 7.4

Yield: 10.0

Momentum: 2.0

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
TORM

A-Score: 6.4/10

Value: 7.7

Growth: 6.9

Quality: 6.6

Yield: 10.0

Momentum: 5.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Scorpio Tankers

A-Score: 6.2/10

Value: 7.3

Growth: 8.3

Quality: 7.5

Yield: 5.6

Momentum: 6.0

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Vopak

A-Score: 6.0/10

Value: 5.7

Growth: 4.6

Quality: 6.3

Yield: 7.5

Momentum: 3.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
Euronav

A-Score: 4.7/10

Value: 5.2

Growth: 6.9

Quality: 5.4

Yield: 5.0

Momentum: 4.0

Volatility: 1.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

137.2$

Current Price

137.2$

Potential

-0.00%

Expected Cash-Flows