(ANW) supplies fuel to ships both in port and at sea, and offers an alternative vehicle to ride the shipping boom. At 31.70, shares have jumped 40% since Jefferies analyst Douglas Mavrinac first flagged the stock on Sept. 14 but still lag behind the 42 target he says they ought to be worth.
With shipyards bursting with orders, Aegean should see increased demand for its services in the years to come. The task of schlepping fuel to ships, undertaken by oil companies decades ago, increasingly is falling to independent suppliers, and Aegean -- which already has service hubs in the Mediterranean, Singapore, Jamaica, United Arab Emirates and on the west coast of Africa -- should continue to snag market share from its smaller, regional peers.
A strong balance sheet with no net debt also gives Aegean financial flexibility and the option to buy smaller, undercapitalized companies. Aegean is expected to double the number of its service hubs and nearly triple its fleet by 2010, and Mavrinac expects sales volume to rise four-fold from 2.3 million metric tons of fuel in 2006 to 9.2 million by 2010. He expects earnings per share, at about 68 cents in 2007, to reach $1.72 in 2008, $3.22 in 2009 and $4.50 in 2010.
Another catalyst: The world's supply of bunkering tankers that can deliver heavy-grade marine fuel will fall off sharply after 2008, as single-hull oil tankers are phased out in accordance with an international rule aimed at reducing pollution in an accident. But Aegean's 16-strong fleet consists of 14 double-hull bunkering tankers. And it has orders for 28 new vessels.
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