Here’s a package deal you won’t be able to resist – and which you’ve probably never heard about before. Dorian LPG (NYSE:LPG) offers a great value and consistent dividend distributions to its shareholders. Plus, momentum-focused traders will appreciate LPG stock’s amazing performance over the past 12 months.
Dorian LPG transports liquefied petroleum gas (LPG) through a fleet of tankers, or more precisely, very large gas carriers. Maybe you’ve never invested in energy-shipping stocks before, but here’s your chance to give it a try. But don’t just jump into the trade; first, let’s conduct some deep due diligence on Dorian LPG.
LPG Stock: Appearances Can Be Deceiving
Dorian LPG stock staged a spectacular rally in 2023, soaring from $16 and change to around $44. This year, investors should be realistic and not expect a similar moonshot.
On the other hand, value-conscious traders don’t need to worry about Dorian LPG shares being overpriced. Believe it or not, Dorian LPG’s GAAP-measured trailing 12-month price-to-earnings ratio is only 7.53x. That’s even lower than the already low sector median P/E ratio of 9.54x.
There’s also good news for passive-income investors, as Dorian LPG is a decent dividend payer. In fact, the company’s previous dividend payments consisted of $1 per share per quarter.
Dorian LPG described its most recent dividend payment as “irregular,” but it wouldn’t surprise me if the company continues to announce distributions to its loyal shareholders.
So, don’t be deceived by appearances. LPG stock zoomed higher last year, but that doesn’t mean it’s too speculative or richly valued. As long as the company’s financials are solid, Dorian LPG can continue to offer an enticing value-and-yield combo.
Dorian LPG’s Astounding Earnings Growth
An important piece of a company’s financial puzzle is its earnings growth. Dorian LPG is definitely an earnings grower, and this helps to explain why the company’s P/E ratio is low despite Dorian LPG’s share-price rally.
Here’s the lowdown for the second quarter of fiscal 2024. Dorian LPG reported adjusted net income of $75 million, or $1.85 per share, beating the analysts’ consensus estimate of $1.73 per share. In the year-earlier quarter, Dorian LPG’s adjusted net income totaled $17.2 million, or 43 cents per diluted share.
That’s astounding growth, as $17.2 million to $75 million represents a 336% year-over-year increase. This can’t just be attributed to energy prices, which certainly didn’t triple in a year’s time.
Dorian LPG observed a moderate increase in propane and butane prices in some regions of the world. This probably provided a tailwind to Dorian LPG in Q2 FY2024. Still, the company’s earnings performance is truly impressive.
On top of that, Dorian LPG improved its capital position, reporting cash and cash equivalents totaling $192.044 million as of Sept. 30, 2023, versus $148.797 million as of March 31, 2023.
Dorian LPG Stock: What More Could You Ask For?
So, there you have it: my secret stock pick for 2024. Dorian LPG offers practically everything that investors could ask for. Whether you’re looking for value, share-price momentum, yield or income growth, you’ll find all the above with Dorian LPG stock.
Now, the secret is revealed and you can start a position in LPG stock. For the maximum compounding effect, remember to reinvest any dividends Dorian LPG might distribute in the coming quarters.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
