Capitalcube gives Teekay Offshore Partners LP a score of 28.
Our analysis is based on comparing Teekay Offshore Partners LP with the following peers – Teekay Corporation, Frontline Ltd., Teekay Tankers Ltd. Class A, Nordic American Tankers Limited, Ardmore Shipping Corp., Teekay LNG Partners L.P., DHT Holdings, Inc., Ship Finance International Limited, Petroleo Brasileiro SA Sponsored ADR and Magellan Midstream Partners, L.P. (TK-US, FRO-US, TNK-US, NAT-US, ASC-US, TGP-US, DHT-US, SFL-US, PBR-US and MMP-US).
Teekay Offshore Partners LP has a fundamental score of 28 and has a relative valuation of UNDERVALUED.
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- Compared to peers, relative underperformance over the last year is in contrast with the more recent outperformance.
- It trades at a lower Price/Book multiple (0.26) than its peer median (0.60).
- The market expects TOO-US‘s earnings to grow at about the same rate as its chosen peers and also does not seem to expect much improvement in its below peer median returns.
- TOO-US has relatively low profit margins and median asset efficiency.
- Changes in annual earnings (relative to peers) are better than the change in its revenues (relative to peers), implying the company is focused more on earnings.
- Over the last five years, TOO-US‘s return on assets has eroded from above median to below median among its peers suggesting declining relative operating performance.
- The company’s median gross margin and relatively low pre-tax margin suggest high operating costs versus peers.
- While TOO-US‘s revenues growth has been below the peer median in the last few years, the market still gives the stock a P/E ratio that is around peer median and seems to see the company as a long-term strategic bet.
- The company seems to be over-investing in a business with median returns.
- TOO-US seems too levered to raise additional debt.
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Leverage & Liquidity
TOO-US would seem to have a hard time raising additional debt.
- With debt at a relatively high 78.01% of its enterprise value compared to an overall benchmark of 25% (Note: The peer median is currently 65.86%), and relatively tight interest coverage level of 1.42x, TOO-US would have a hard time raising much additional debt. The company has a Constrained profile in terms of its ability to take on further debt.
- All 10 peers for the company have an outstanding debt balance.
TOO-US has maintained its Limited Flexibility profile from the recent year-end.
- TOO-US‘s interest coverage is its lowest relative to the last five years and compares to a high of 4.19x in 2012.
- The decrease in its interest coverage to 1.42x from 1.96x (in 2016) was also accompanied by a decrease in its peer median during this period to 1.53x from 2.80x.
- Interest coverage rose 0.73 points relative to peers.
- TOO-US‘s debt-EV is its lowest relative to the last five years and compares to a high of 83.05% in 2015.
- Like the interest coverage trend, the decrease in its debt-EV (to 78.01% from 80.96%) was also accompanied by a decrease in its peer median during this period (to 65.86% from 68.07%).
- Relative to peers, debt-EV fell 0.75 percentage points.
Access the detailed analysis for Teekay Offshore Partners LP
Key Liquidity Items
|Company||Debt/Enterprise Value (%)||Current Ratio||Interest Coverage (x)||Cash Flow To Total Debt (%)|
|Teekay Tankers Ltd. Class A||76.27||0.67||0.73||6.61|
|Nordic American Tankers Limited||46.37||3.52||-0.6||31.29|
|Ardmore Shipping Corp.||65.86||1.57||0.41||6.8|
|Teekay LNG Partners L.P.||64.04||0.32||2.53||6.66|
|DHT Holdings, Inc.||63.34||1.75||2.1||18.49|
|Ship Finance International Limited||64.93||0.8||1.85||11.85|
|Petroleo Brasileiro SA Sponsored ADR||87.71||2.04||1.53||20.82|
|Magellan Midstream Partners, L.P.||19.23||0.5||4.42||26.59|
|Teekay Offshore Partners L.P.||78.01||0.54||1.42||6.51|
|Best In Class||19.23||3.52||4.42||31.29|
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Teekay Offshore Partners LP provides marine transportation, oil production and storage services to the offshore oil industry. It owns interests in shuttle tankers, floating production, storage and offloading units, floating storage and offtake units and conventional oil tankers. The company operates through the following segments: Shuttle Tanker; Floating Production, Storage and Offloading; Units for Maintenance and Safety; Towage; Conventional Tanker, and Floating Storage and Offtake. The Shuttle Tanker segment consists of shuttle tankers operating primarily on fixed-rate contracts of affreightment, time-charter contracts or bareboat charter contracts. The Floating Production, Storage and Offloading segment consists of its FPSO units subject to operations and charter contracts. The Units for Maintenance and Safety segment is used primarily for offshore accommodation, storage and support for maintenance and modification projects on existing offshore installations, or during the installation and decommissioning of large floating exploration, production and storage units, including FPSO units, FLNG units and floating drill rigs. The Towage segments long-distance towing and offshore installation vessels are used for the towage, station-keeping, installation and decommissioning of large floating objects such as exploration, production and storage units, including FPSO units, floating liquefied natural gas units and floating drill rigs. The Conventional Tanker segment consists of conventional tankers operating on fixed-rate, time-charter contracts or bareboat charter contracts. The Floating Storage and Offtake segment consists of its FSO units subject to fixed-rate, time-charter contracts or bareboat charter contracts. Teekay Offshore GP L.L.C. serves as the general partner of the company. Teekay Offshore Partners was founded on August 31, 2006 and is headquartered in Hamilton, Bermuda.
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