FLEX LNG is preparing to release its third-quarter earnings report on Wednesday, with investors anticipating a decline from the previous quarter’s strong performance. Analysts forecast earnings per share of $0.64 and revenue of $95.5 million, representing drops of roughly 19% and 11%, respectively, compared to the second quarter. The Bermuda-based LNG shipping company’s stock is currently trading at $26.04, with a market capitalization of $1.41 billion, just above its 52-week low of $24.14. Five analysts covering the company have given it a consensus Sell rating, with a mean price target of $26.13, suggesting minimal upside of 0.3%.
The expected sequential decline comes despite robust year-over-year growth, with analysts projecting a 49% increase in EPS and an 11.5% rise in revenue compared to the same quarter last year. This growth reflects stronger charter rates earlier in the year due to geopolitical disruptions that tightened vessel supply. However, the company faces skepticism as it navigates a weakening rate environment, with investors closely watching charter rate sustainability and the impact of a looming newbuild wave.
The LNG carrier orderbook stands at approximately 285 vessels, equivalent to around 37% of the current fleet, with 40-45 vessels expected to deliver by the end of 2026. This surge in capacity has pressured spot rates, which plummeted from peaks above $300,000 per day in March to historic lows near $9,000 per day by late August. Management’s explanation for the sequential revenue decline will be scrutinized, particularly given the company’s heavy charter coverage that typically provides earnings visibility.
FLEX LNG delivered a strong second quarter, reporting EPS of $0.79 that beat the $0.63 consensus by 26%, with revenue of $106.8 million exceeding expectations by 14%. The company has maintained a forward P/E ratio of 11.18 and projected EPS growth of 68.89% despite a challenging operating environment marked by elevated European gas storage and reduced demand for floating storage. The third-quarter results will test whether FLEX LNG’s charter-heavy business model can sustain profitability amid geopolitical disruptions and structural oversupply from aggressive fleet expansion.