Torm PLC Stock: 9.6%-Yielder Reports Solid Q1 Results
July 30, 2025
TRMD Stock Up 17% Over Last 3 Months
There are concerns that a global trade war could negatively impact oil and gas prices. There’s less demand for oil and gas when the economy is sluggish. However, there’s one energy industry that isn’t expected to be impacted by an economic downturn: oil and gas midstream, especially product tanker companies like Torm PLC (NASDAQ:TRMD). That’s why I’m putting the spotlight on Torm PLC stock today.
U.S. tariffs are not expected to directly affect oil and oil product flows, but they could have an indirect impact through slower global economic growth. Moreover, tighter U.S. sanctions on Venezuela and Iran are expected to have a positive effect on the global crude tanker market by redirecting trade.
These near-term factors and longer-term growth forecasts for the oil and gas midstream market bode well for Torm PLC. Moreoer, they should help the company maintain its position as a leader in the midstream oil and gas shipping market.
Torm PLC is one of the world’s largest owners and operators of product tankers transporting refined oil products and chemicals. (Source: “About,” Torm PLC, last accessed July 11, 2025.)
The company’s fleet consists of more than 90 owned and operated vessels that range in size between 45,000 and 114,000 deadweight tons (DWT). That’s how much weight a ship can safely carry, including cargo, fuel, provision, and other materials on board. (Source: “Investor Presentation,” Torm PLC, January 8, 2025.)
The company’s fleet covers all large vessel classes in the product tanker market, with a specific focus on the Long Range 2, Long Range 1, and Medium Range tankers, as these segments offer the greatest synergies. (Source: “Our Fleet,” Torm PLC, last accessed July 11, 2025.)
Long Range 1 tankers are designed to carry both refined products and crude oil from the Middle East to Europe. Long Range 2 tankers are generally used on long trade routes, such as carrying diesel from the eastern hemisphere into the Atlantic. A typical trade for Medium Range vessels would be gasoline from Europe to the U.S.
Torm’s highly diversified customer base is made up of blue-chip giants like Shell PLC (NYSE:SHEL), Chevron Corp (NYSE:CVX), and Exxon Mobile Corp (NYSE:XOM). No client accounts for more than 10% of revenue.
Another Solid Quarter
Torm PLC continues to report solid financial results. For the first quarter ended March 31, 2025, it reported time charter equivalent (TCE) earnings of $214.0 million, down from $330.0 million in the first quarter of 2024. (Source: “TORM plc Q1 2025 Results, Dividend Distribution, and Financial Outlook 2025,” Torm PLC, May 8, 2025.)
The company reported earnings before interest, taxes, depreciation, and amortization (EBITDA) of $137.7 million, versus $267.2 million in the same prior-year period. Torm realized net profit of $62.9 million, down from $209.2 million in the first quarter of 2024. The drop in net profit is a result of significantly lower freight rates compared to the same quarter last year, although they were in line with the previous quarter.
Torm reported fleet-wide TCE rates of $26,807 per day, which resulted in first-quarter earnings of $0.64 per share. The number of available earnings days increased to 8,061 from 7,697 in the first quarter of 2024.
Commenting on the results, Jacob Meldgaard, the company’s chief executive officer, said, that Torm delivered a solid first-quarter result that was in line with expectations, despite continued geopolitical uncertainty. That uncertainty included a decline in trade volume routes affected by disruptions in the Red Sea. This reduced the distance-driven ton-mileage, resulting in product tanker ton-miles rebounding in March 2025.
2025 Outlook
As of May 5, Torm had covered 57% of its second-quarter earning days at an average rate of $28,026. For the full year, 43% of its earning days were fixed at an average rate of $27,829. The remaining 57% remains open and subject to market fluctuations.
Based on the earnings realized in the first quarter of the year as well as the coverage for the remaining part of the year, Torm narrowed its full-year 2025 guidance. It now expects to report:
- TCE earnings in the range of $700.0–$900.0 million
- EBITDA in the range of $400.0–$600.0 million
Torm PLC Stock: Q1 Dividend of $0.40/ Share
Thanks to Torm’s large fleet, market penetration, and strong cash generation, Torm PLC stock is able to provide investors with a reliable, variable distribution.
For the first quarter, the company’s board declared a dividend of $0.40 per share, or $1.60 per share on an annual basis, for a forward dividend yield of 9.6%. (Source: “Distribution,” Torm plc, last accessed July 11, 2025.)
Because Torm PLC stock’s dividend is tied to the company’s profitability, it will fluctuate from quarter to quarter. In April 2025, Torm PLC stock paid out $0.60 per share in dividends, which was down from the $1.20 per share it paid out in December 2024.
26% Upside with Torm PLC Stock?
TRMD stock has not fully recovered from the early April stock market sell-off that was prompted by President Donald Trump unveiling his global tariffs. But the stock is clawing its way back, up 17% over the last three months.
Torm PLC stock’s big gains come in spite of concerns about tariffs, inflation, and rising interest rates. If anything, these issues are now on the backburner.
Global stocks got a boost recently from easing fears about ongoing conflicts in the Middle East. U.S. inflation remains low at 2.4%; slightly higher than the 2.3% in May, but still lower than the long-term average.
Should U.S. inflation remain low throughout the summer months, this could give the Federal Reserve the confidence to cut interest rates as early as September. Lower interest rates encourage borrowing and should help further energize the bull market.
Wall Street is still bullish on Torm PLC stock, but they have tempered their outlook. Before the April 2 sell-off, Wall Street had a 12-month share price target of $48.00.
Analysts now have a 12-month share price target range of $21.50 to $23.00 per share on TRMD stock. That points to potential upside of 18% to 26.5%.
Chart courtesy of StockCharts.com
The Lowdown on Torm PLC Stock
Torm PLC is a pure play product tanker company with a strong balance sheet that continues to report solid financial results. In June, the company paid a variable, quarterly dividend of $0.40 per share. And Torm PLC stock is up more than 17% over the last three months.
Institutional ownership in TRMD is robust, with 176 institutions holding 60.29% of all outstanding shares. The three biggest holders are Oaktree Capital Management LP, Arrowstreet Capital, Limited Partnership, and The Vanguard Group. (Source: “TORM plc (TRMD),” Yahoo! Finance, last accessed July 11, 2025.)
