HAFN Stock: This 17%-Yielding Stock Screams Opportunity
May 26, 2025
A Rare Stock Pick for Income Investors
Let’s be honest: quality, high-yield dividend stocks are rare these days. If you find one, chances are it comes with red flags—unsustainable payouts, a deteriorating business, or a collapsing stock price.
However, every once in a while, a gem shows up. One that not only offers a sky-high dividend, but is also backed by solid operations and growing profits…all while being a cheap stock.
With that said, income investors need to pay attention to Hafnia Ltd (NYSE:HAFN).
It is very likely you’ve never heard of HAFN stock in the mainstream press. But make no mistake, this little-known shipping stock is quietly delivering monster returns and throwing off serious dividends for investors.
What Does Hafnia Do?
Hafnia Ltd is one of the largest product tanker owners and operators in the world. It owns and charters ships that transport refined petroleum products like gasoline, diesel, and jet fuel globally.
The company operates over 200 vessels and generates the bulk of its revenue in the spot market. This essentially means that it charges variable rates based on demand. This gives Hafnia the flexibility to capitalize on high-rate environments, especially during periods of geopolitical instability or amidst supply chain disruptions—like we’ve recently been experiencing. (Source: “About Hafnia,” Hafnia Ltd, last accessed May 19, 2025.)
Off-the-Charts Financial Performance
Hafnia is firing on all cylinders.
In the first quarter of 2025, the company reported net income of $63.2 million, or $0.12 per share.
Time charter equivalent (TCE) earnings were $218.8 million in the first quarter of 2025, resulting in average TCE of $22,992 per day.
Translation: business is booming.
What’s ahead for Hafnia?
Well, Mikael Skov, the company’s chief executive officer, had this to say: “As we conclude the first quarter of 2025, and while market dynamics remain complex, I am optimistic about Hafnia’s ability to build on this positive momentum. Our proven track record of operational excellence and financial discipline positions us strongly to create long-term value. We are focused on making the right decisions daily, through disciplined capital allocation and agile fleet deployment, to ensure flexibility in capitalizing on opportunities and enhancing shareholder returns.” (Source: “Condensed Consolidated Quarterly Financial Information Q1 2025,” Hafnia Ltd, May 15, 2025.)
HAFN Stock Offers a Very Frothy Dividend
Right now, HAFN stock has a frothy dividend yield of 17%—this is not a misprint.
Usually, investors would write off a stock with a dividend yield of over 10% because it’s deemed unhealthy and difficult to maintain.
But, before you deem HAFN stock too good to be true, understand this: the company is generating enough cash to cover this payout. This isn’t a struggling business propping up its stock with unsustainable dividends; this is a cash cow with discipline.
If business improves, don’t be shocked if Hafnia were to dish out even bigger dividend payments.
In the previous few quarters, the company reduced its dividends a little. But the management team has made dividends its big priority.
Regarding HAFN stock’s dividend for the first quarter of 2025, Skov said, “We are confident in the market, and I am pleased to announce a full cash payout ratio of 80% for the quarter. We will not deduct the USD 27.6 million utilized for share buybacks during this period when calculating our dividend. We will distribute a total of USD 50.6 million or USD 0.1015 per share in dividends.” (Source: Ibid.)
But that’s not all…
At the time of writing, HAFN stock is trading for around $5.35 per share. Analysts have a price target as high as $10.00—representing potential upside of over 86%. Even the most conservative target of $6.00 would mean upside of over 12%.
Chart Courtesy of StockCharts.com
Insiders Heavily Invested in HAFN Stock
When assessing companies, one thing worth paying attention to is how heavily insiders are invested. Do they own a lot or just a fraction of the company?
High insider ownership means that insiders have skin in the game, so there’s more incentive to make sure the company does well.
With Hafnia, insiders own about 44% of the outstanding shares. That’s not pocket change—that’s significant skin in the game. Moreover, this high ownership in HAFN stock indicates that insiders believe in the company’s long-term trajectory.
There’s also high institutional ownership in HAFN stock—about 23% of all outstanding shares are owned by institutional investors. Big names like Acadian Asset Management, The Vanguard Group, and Folketrygdfondet are a few of the biggest holders of HAFN stock. (Source: “Holders,” Yahoo! Finance, last accessed May 19, 2025.)
Put simply, insiders and smart money are paying attention to HAFN stock.
The Lowdown on HAFN Stock
This is not a recommendation to buy, but for income investors chasing consistent dividends, Hafnia stock could be the place to be. It comes with a big dividend backed by real earnings and the potential for serious capital gains.
With HAFN stock, a shareholder gets:
- A 17% dividend yield
- A rock-solid balance sheet
- Massive insider and institutional ownership
- Industry tailwinds
To say the least, opportunities like HAFN don’t come across our radar often. This isn’t just a boring dividend stock; there could be immense capital appreciation as well.
