| Account | Shares | Price | Value | % of acct | Cost/sh | Gain $ | Gain % | Target |
|---|---|---|---|---|---|---|---|---|
| HSA | 28 | $45.42 | $1,272 | 1.18% | $35.83 | $269 | +26.8% | — |
In short: Named with STNG as the tanker that could retire its debt on one more year like this one. On the war tape: "some other names in the space… that are interesting are like DHT, Nordic American, Frontline, which is FRO, Ardmore Shipping." In Q&A: "like Frontline and STNG, if they were to generate as much cash as they're generating this year, next year, not only would they be able to pay off all their debt, they would be able to pay 20, 30% one-time dividends" — held as a war-duration hedge rather than chased: "it really just depends on the war and I wouldn't add them now as an outright long."
Full passage: premium transcript (PDF).
In short: Owned since '22. John Fredriksen — the industry's best capital allocator. Tanker supply shrank (boats scrapped for steel, few replaced); rates ~$100k/day through the conflict. Whether the squeeze holds is "a good debate" — Smead is "playing the game of patience" rather than selling.
Frontline owns oil tankers — the ships that haul crude around the world — so it's really a shipping bet, not a driller (even though index-makers file it under "energy"). Smead bought in 2022 when the industry was scrapping more ships for steel than it was building, shrinking the supply of tankers. With fewer boats and oil needing to move, daily rental rates ("charter rates") have run near $100,000 a day. Owners are reluctant to give up their ships because they couldn't re-charter them as cheaply, which sustains high rates. Whether this lasts is genuinely debated; Smead's answer is patience — he'd rather hold than try to time the top. He rates the manager, John Fredriksen, the best capital allocator in the business.
42:34Okay, now, Frontline will get lumped into the S&P GICS energy sector. But it's a tanker business. Okay? If someone asked me where we at in the tanker business, that's a really good debate right now. Okay? We got involved in it in when the market was very tight in '22. What was going on then is tanker companies were selling their boats for steel prices cuz steel was high and scrapping those.
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