• If you are wondering whether International Seaways at around US$58.62 is still offering value or if most of the story is already priced in, you are not alone.
• The stock has had a mixed short term patch with a 1.2% decline over the last week, but it also shows a 21.0% return over 30 days, 24.7% year to date, 58.7% over 1 year and 89.2% over 3 years.
• Alongside these moves, investors have been reacting to sector wide shipping and energy market headlines, which often sway sentiment toward tanker owners like International Seaways. Broader discussions around trade flows, freight demand and supply of vessels have stayed in focus and help explain why interest in the stock has remained high.
• International Seaways currently has a valuation score of 4 out of 6. This means it screens as undervalued on most of the checks we run. Next, we will walk through the key valuation approaches behind that score before finishing with a way to look at value that goes beyond the usual multiples.

Approach 1: International Seaways Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model looks at the cash International Seaways is expected to generate in the future, then discounts those cash flows back to today to estimate what the business could be worth now.

For International Seaways, the model uses a 2 Stage Free Cash Flow to Equity approach, starting from last twelve months free cash flow of about $143 million. Analysts provide explicit estimates up to 2026, where free cash flow is projected at $277 million, and Simply Wall St extends this path further using extrapolated assumptions through 2035. These ten year projections, all in $, are discounted back to today to reflect the time value of money and risk.

On this basis, the DCF model arrives at an estimated intrinsic value of about $124.03 per share. Compared with the current share price of around $58.62, the model implies the stock is 52.7% undervalued according to these inputs and assumptions.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests International Seaways is undervalued by 52.7%. Track this in your watchlist or portfolio, or discover 55 more high quality undervalued stocks.

Approach 2: International Seaways Price vs Earnings

For a profitable company like International Seaways, the P/E ratio is a useful quick check because it links what you pay per share directly to the earnings backing that share. Investors generally accept that higher growth expectations or lower perceived risk can justify a higher P/E, while lower growth or higher risk usually call for a lower, more cautious multiple.

International Seaways currently trades on a P/E of 13.32x. That sits below the Oil and Gas industry average of 14.13x and above the peer group average of 11.53x. Simply Wall St also estimates a proprietary “Fair Ratio” of 14.27x, which reflects factors such as the company’s earnings growth profile, margins, industry, market value and risk characteristics. This Fair Ratio aims to be more tailored than a simple comparison with broad industry or peer averages, which do not adjust for these company specific inputs.

Setting the current P/E of 13.32x against the Fair Ratio of 14.27x suggests the shares are trading at a discount on this metric.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your International Seaways Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which are simply your story about a company connected directly to your own numbers for fair value, future revenue, earnings and margins.

On Simply Wall St, Narratives sit inside the Community page and give you a clear link from a company’s story to a financial forecast and to an estimated fair value that you can easily compare with the current price to help decide whether the shares look attractive or expensive for you.

Because Narratives on the platform are updated when new information such as news or earnings is added, you can see how the story and fair value change over time instead of relying on a single static estimate.

For International Seaways, one investor might focus on tanker market tightness and assign a higher fair value, while another might be more cautious about future day rates and set a lower fair value, and the Community Narratives let you see those different perspectives side by side with your own.

Do you think there's more to the story for International Seaways? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.