International Seaways, Inc. (INSW): what the price assumes

Generated: 2026-07-29 · Exported: 2026-08-01 · Source: https://boothcheck.com/report/INSW

Headline

Field	Value
Ticker	INSW
Company	International Seaways, Inc.
Current price	$94.01/sh
Composition	Crude Tankers 52% / Product Carriers 48%

What The Price Assumes (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

Field	Value
Inversion basis	whole-company
Operating margin (value-band context)	8.3%
Operating margin today	58.3%
Margin compression (value-band)	-50.0pp
Multiple paid	10x operating income

The operating-margin figure is value-band context at year 12: derived from the framework's value band, a separate calculation — not part of the priced-in solve.

The price sits below what even a 5%/yr operating-profit decline would warrant; the inversion reports a bound, not a solved growth path.

Solve inputs: computed at a 8.8% cost of capital with 4% terminal growth over a 5-year stage.

How unusual the bet is: within-range

Reference	Value
vs own history	+0.02σ
cohort percentile (of 222 peers)	7
implied end-window share	0%

Valuation X-Ray

The price is supported by asset-based and earnings-power and relative-multiple and growth-DCF value. A value/asset-supported name, not a pure growth bet.

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

Family	Median price/FV	Models	Reads
Asset	0.79x	5	justifies
Earnings	0.93x	4	justifies
Relative	0.51x	5	justifies
Growth	0.43x	4	justifies

Families that justify the price: Asset, Earnings, Relative, Growth

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 8.3%); the inversion above states its own rate.

Per-Model Detail (n=18)

Model	Family	FV	Price/FV	Applicable	Methodology
DCF Perpetual Growth	Growth	$372.37	0.25x	yes	FCF base $0.5B, growth 20% (input: historical growth), terminal g 4.0%, WACC 8.3%, 7yr projection
DCF Exit Multiple	Growth	$171.10	0.55x	yes	Exit EV/EBITDA: 5.0x / 7.0x / 9.0x (bear / base = today's held flat / bull), 7yr
Relative Valuation	Relative	$192.89	0.49x	yes	P/E 15.42x (blended: static sector reference 20x + trailing (TTM) 9x), scenarios: 12.5x / 15.4x / 18.3x (bear / base = reference held flat / bull), EV/EBITDA 13x
Simple DDM	Growth	—	—	no	—
Two-Stage DDM	Growth	$303.69	0.31x	yes	Stage 1: 20% for 5yr, Stage 2: 3.5% perpetual
Simple Excess Return	Asset	$118.70	0.79x	yes	BV/sh $44.14, ROE (TTM) 24.9%, ke 9.3%
Two-Stage Excess Return	Asset	$195.57	0.48x	yes	5yr excess ROE then converge to ke=9.3%
Discounted Future Market Cap	Growth	$100.94	0.93x	yes	Rev $1.0B, growth 20% (input: historical growth; tapered), Terminal P/S: 3.9x / 4.7x / 5.6x (bear / base = today's held flat / bull, cap 12x)
Peter Lynch Fair Value	Relative	$131.76	0.71x	yes	EPS $10.98, growth 2% (input: historical EPS growth), PEG=5.22 (Overvalued)
Margin Trajectory	Growth	—	—	no	—
Earnings Power Value	Earnings	$66.15	1.42x	yes	Normalized EBIT (5y avg op income, one-time charges added back) $0.41B × (1−21%) / WACC 8.3% → EPV (no growth)
Residual Income	Asset	$175.27	0.54x	yes	BV $44.14 + 5yr PV of (ROE (TTM) 24.9% − Kₑ 9.3%) × BV; BV grows 8.8%/yr
Graham Number	Asset	$104.42	0.90x	yes	√(22.5 × EPS $10.98 × BVPS $44.14) — Graham's conservative floor
EV/EBITDA Relative	Relative	$183.32	0.51x	yes	EBITDA $0.74B × sector EV/EBITDA 13.0x
FCF Yield	Earnings	$88.12	1.07x	yes	FCF $451.2M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF Yield	Earnings	—	—	no	—
Ben Graham Formula	Earnings	$354.29	0.27x	yes	EPS $10.98 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/B	Asset	$45.11	2.08x	yes	BV $44.14 × (ROIC 8.5% / WACC 8.3%)
P/Sales Sector	Relative	$39.64	2.37x	yes	Revenue $0.99B × sector P/S 2.0x
PEG Fair Value	Relative	$411.75	0.23x	yes	EPS $10.98 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings Yield	Earnings	$118.70	0.79x	yes	EPS $10.98 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations Multiple	Relative	—	—	no	—
Clinical Phase NPV	Growth	—	—	no	—
Merton	Asset	—	—	no	—
V5 Mechanical	—	—	—	no	—

Solvency

Field	Value
Net debt	$225.2m
Net debt / NOPAT (after-tax)	0.50x
Net debt / operating income (pre-tax)	0.39x
Share count CAGR (dilution)	0.1%
Burning cash	no

Interest expense is not separately reported in the latest filings, so interest coverage cannot be computed.

Bullet Takeaways

• International Seaways owns and operates oil tankers, 13 large crude carriers and 38 smaller refined-product tankers, renting them to shippers at rates that swing widely with the global tanker market.
• The model returns nearly all the cash: the company declared a combined dividend of $2.15 per share in March 2026, about 87% of adjusted net income and its largest quarterly payout ever.
• Watch tanker rates, the one variable that drives everything; income from vessel operations already fell to $345.4 million in 2025 from $455.2 million in 2024 on softer product-carrier rates, the early sign the cycle can turn.

Bull Case

The capital-allocation policy is the clearest expression of the bull case, because International Seaways is built to hand the cash back. The company runs a variable-dividend model, paying out a large share of earnings rather than hoarding them, and it just declared a combined dividend of $2.15 per share for March 2026, roughly 87% of adjusted net income and the largest quarterly dividend in its history. For a cyclical business, that policy is exactly right: rather than reinvesting peak-cycle cash into expensive ships at the top of the market, management returns it to shareholders and lets them decide what to do with it. The shareholder who buys here is buying a stream of variable distributions tied directly to how much the fleet earns.

The earnings funding those distributions have been substantial. Full-year 2025 net income was $309 million, or $6.23 per diluted share, on adjusted EBITDA of $475 million, and the first quarter of 2026 alone produced net income of $286 million, or $5.75 per share. The fleet that generates this is diversified across the tanker market: 13 very large crude carriers at the big end and 38 medium-range product tankers at the smaller end, with crude and product carriers each contributing roughly half of revenue. That split matters because crude and refined-product shipping rates do not always move together, so the mix smooths the swings somewhat.

The balance sheet is the safety underneath the cyclicality. International Seaways carries a net loan-to-value ratio of just 12.9% and a net-debt-to-capital ratio of 16.5%, with 44% of the fleet unencumbered and total liquidity of $723.6 million. Net debt is only about 0.4 times a year's operating income, and interest is covered roughly 14 times over. A shipping company with that little leverage can pay out most of its earnings through the good years and still survive a downturn without distress, because it does not have heavy debt service consuming the cash when rates fall. The bull case is a low-leverage, high-payout tanker operator priced cheaply on every method, returning peak-cycle cash to shareholders rather than burning it on the fleet.

Bear Case

The question that decides everything for a tanker company is whether today's earnings are sustainable or a cycle peak, and the evidence points to peak. International Seaways earned a 58% operating margin in the trailing period, which is extraordinary and exactly what tanker operators print when charter rates spike. Those rates are set by the global balance of tanker supply and oil-shipping demand, neither of which the company controls, and they are notoriously volatile. The early signs of the turn are already in the numbers: income from vessel operations fell to $345.4 million in 2025 from $455.2 million in 2024, driven by lower average daily rates in the product-carrier fleet. When the most profitable input to the business is a spot rate that has started declining, the high current margin is a warning, not a baseline.

The supply side of the cycle is the structural threat. When tanker rates are high, shipowners order new vessels, and because ships take years to build and decades to operate, those orders arrive as new capacity that depresses rates for years afterward. The industry has a long history of converting profitable periods into oversupplied ones, and a fleet of ships is a fixed asset that keeps competing for cargo whether rates are good or bad. The company cannot shrink to match weaker demand the way an asset-light business can; the vessels exist and must be employed. That asymmetry, easy to add capacity at the top and hard to remove it at the bottom, is why tanker earnings mean-revert and often overshoot to the downside.

The valuation reflects all of this, which is both the bear's point and its limit. The stock trades around 11 times operating income, and the price implies operating profit declining about 3.5% a year, so the market is already pricing a fading cycle, and every valuation method reads the stock as cheap precisely because the methods capitalize earnings the market believes are unsustainable. The variable dividend that looks attractive at the peak shrinks with earnings: an 87% payout of a falling profit is a falling dividend, so the headline yield is not a fixed return but a cyclical one. The balance sheet is genuinely strong, so this is not a solvency bear; International Seaways will not be forced into distress. The bear case is simpler: buying a cyclical at a low multiple on peak earnings can still lose money, because the multiple is low for a reason and the earnings have further to fall than the price yet reflects.

Valuation

The price is already set for a fading cycle. At about $84 (June 27, 2026) International Seaways trades near 11 times operating income, and inverting that says the market is paying for operating profit to decline about 3.5% a year for five years. That is the key context for a tanker stock: the low multiple is not the market calling the company cheap on a steady-state basis, it is the market discounting earnings it expects to fall from a cyclical high. The 58% operating margin behind that 11-times multiple is the peak-cycle number, and the price is implicitly betting it does not last.

The methods we use to triangulate all land below the price in the sense of reading the stock as inexpensive, with the growth and relative-multiple lenses the most emphatic. Asset-based methods support the price too, which is meaningful for a shipping company because the ships are real, saleable assets, and a tanker operator trading below the value of its fleet has a tangible floor that an asset-light business lacks. But the uniformity of the cheap reading is itself the cyclical signal: when every method says a stock is cheap on trailing earnings, and those earnings sit at a cycle peak, the cheapness is the market pricing mean reversion rather than offering a free lunch. The peer cohort, other shipping and marine-transport names, trades on the same logic, so International Seaways is not an outlier; it is priced like the cyclical it is.

Solvency is the genuine strength and the reason the downside is bounded. Net debt is only about 0.4 times a year's operating income, with a net loan-to-value of 12.9%, 44% of the fleet unencumbered, and liquidity of $723.6 million. That low leverage means the company can ride a rate trough without forced asset sales or a dividend it cannot afford, and the unencumbered ships are an asset floor under the equity. What bounds the analysis is therefore not balance-sheet risk but the trajectory of charter rates: the buyer at this price is paying a low multiple for a low-leverage tanker operator with a strong fleet and a generous variable dividend, accepting that both the earnings and the dividend will rise and fall with a shipping cycle the company does not control.

Catalysts

The recent results show a still-profitable company past its rate peak. Full-year 2025 net income was $309 million, or $6.23 per diluted share, on adjusted EBITDA of $475 million, but income from vessel operations fell to $345.4 million from $455.2 million in 2024 on lower product-carrier rates. The first quarter of 2026 was strong, with net income of $286 million, or $5.75 per share, and adjusted net income of $194 million, or $3.90 per share.

The capital return is the headline catalyst. The company declared a combined dividend of $2.15 per share for March 2026, about 87% of adjusted net income and its largest quarterly dividend ever. Because the payout is tied to earnings, the dividend itself tracks the rate cycle, so each quarter's declaration is a real-time read on profitability. The events to watch are the direction of crude and product tanker rates, the order book for new vessels across the industry, which signals future supply pressure, and any fleet transactions, because for a cyclical that returns most of its cash, the rate trend and the disciplined refusal to overbuild at the top are what determine whether the high payouts continue or compress.

Peer Cohorts (Per Segment, With Filing Citations)

Crude Tankers (reported)

• FRO (Frontline plc)
• FY2025 20-F: …between the larger refinery centers around the world, being the Gulf of Mexico, Middle East, Rotterdam and Singapore. We are committed to providing quality transportation services to all of our customers and to developing and maintaining long-term relationships with the major charterers of tankers. Increasing global…
• FY2025 20-F: …Coupled with a rapid ageing fleet, we expect these structural supply constraints to partially offset scheduled newbuilding deliveries, creating a manageable net fleet growth. Together with a constructive crude demand outlook and anticipation of further replacement of sanctioned volumes transferring to the compliant…
• TNK (TEEKAY TANKERS LTD.)
• (no filing in the citation store)
• CMRE (COSTAMARE INC.)
• FY2025 20-F: …also utilizing bank financing. Our Fleet Our Containership Fleet The tables below provide additional information about our fleet of containerships, including the vessels under construction, as of February 24, 2026. Some of our vessels are subject to sale and leaseback transactions as indicated here below. Each vessel…
• FY2025 20-F: …be equipped with exhaust gas scrubbers, which allow the vessel to use the existing, less expensive, high sulphur content fuel, or have undertaken fuel system modification and tank cleaning, which allows the vessel to use more expensive, low sulphur fuel. Vessels that are not equipped with exhaust gas scrubbers cannot…

Product Carriers (reported)

• TNK (TEEKAY TANKERS LTD.)
• (no filing in the citation store)
• LPG (DORIAN LPG LTD.)
• FY2025 10-K: …including the four time chartered-in vessels, were deployed in the Helios Pool. ​ Our customers, either directly or through the Helios Pool, include or have included global energy companies such as Exxon Mobil Corp., Chevron Corp., China International United Petroleum & Chemicals Co., Ltd., Royal Dutch Shell plc,…
• FY2025 10-K: …as well, and include: ​ ● location of the vessel; ​ ● attractiveness of the contractual terms of the voyage charter agreement; and ​ ● competitiveness of the charter rate offered. ​ 33 Table of Contents VLGCs operate in a highly competitive market and we expect substantial competition for providing transportation…
• NVGS (NAVIGATOR HOLDINGS LTD.)
• FY2025 20-F: …charters exceeding 12 months. For the year ended December 31, 2025 approximately 66.9% of our revenue was generated pursuant to time charters, compared to approximately 65.8% for the year ended December 31, 2024. Voyage Charters . A voyage charter or spot charter is a contract, typically for shorter intervals, for…
• FY2025 20-F: 2.4 years as of December 31, 2025, compared to an average age of 11.7 years as of December 31, 2024. We believe that our relatively young fleet positions us well to compete in terms of our vessels meeting the strategic and operational needs of our customers. We own and operate the largest fleet in the handysize…
• FLNG (FLEX LNG Ltd.)
• FY2025 20-F: Aurora elected not to utilize their extension option and the vessel is expected to be redelivered from the existing contract late in the first quarter of 2026. Following the re-delivery, the vessel will be marketed for short and long-term contracts. Customers Our assessment of a charterer's financial condition and…
• FY2025 20-F: …highly competitive and based primarily on supply and demand. The process of obtaining new time charters generally involves intensive screening and competitive bidding, and often extends for several months. LNG carrier time charters are generally awarded based upon a variety of factors relating to the vessel operator,…
• GLNG (Golar LNG Limited)
• FY2025 20-F: …in the supply of vessel capacity without a commensurate increase in demand; • the type, size and age of a vessel; • competition from more technologically advanced vessels; and • the cost of new buildings or retrofitting or modifying existing vessels, as a result of technological advances in vessel design or…
• FY2025 20-F: Registrant's Action to Recover Erroneously Awarded Compensation Not applicable. 50 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major shareholders The following table presents certain information as of March 16, 2026 regarding the beneficial ownership of our common shares with respect to shareholders…
• KEX (KIRBY CORPORATION)
• FY2025 10-K: …barges and United States product tankers in the 300,000 barrels plus category, excluding the fleet of large tankers dedicated to Alaska crude oil transportation, occasionally compete in the 195,000 barrels or less market to move large volumes of refined petroleum products within the Gulf of America with occasional…
• FY2025 10-K: Although the Company considers its relationship with EMD to be strong, the loss of the EMD distributorship and service rights, or a disruption of the supply of EMD parts, could have a negative impact on the Company's ability to service its customers. In 2020, with the acquisition of Convoy Servicing Company and…
• SFL (SFL Corporation Ltd.)
• FY2025 20-F: …instruments. 48 Revenues Since our incorporation in 2003 and public listing in 2004, we have increased our customer base from one to more than 10 customers. In addition, Golden Ocean is no longer a customer, since July 2025, when we sold and delivered eight Capesize dry bulk carriers to them, following exercise of…
• FY2025 20-F: …other assets chartered to a number of counterparties. We also partially own four container vessels on long-term bareboat charters to MSC Mediterranean Shipping Company S.A. and its affiliate Conglomerate Shipping Ltd. or MSC. Our other vessels that have charters attached to them are chartered to other customers under…
• MATX (Matson, Inc.)
• FY2025 10-K: …be impacted by new or increased competition. ​ The Company has faced and may continue to face new competition by established or start-up shipping operators that enter into the Company's markets. The shipping industry is competitive with limited barriers to entry. Ocean carriers can shift vessels in and out of…
• FY2025 10-K: …in Auburn, Washington for consolidation and shipment to its service center in Anchorage and a network of other facilities in Alaska. Span Alaska also provides trucking services to its Auburn cross-dock facilities and from its Alaska-based cross-dock facilities to final customer destinations in Alaska. Warehousing…

Methodology Note

• Priced-in inversion: the valuation is inverted on the current price to recover the operating-income growth, duration, and steady-state margin the price embeds (ROE for financials, FFO growth for REITs).
• Valuation x-ray: the valuation models, grouped into four families (asset, earnings, relative, growth). Each model is expressed as a price/FV ratio (distance from price), not a point fair-value estimate. The spread across families is the disagreement.
• Solvency: net cash/debt, net-debt-to-NOPAT, interest coverage, and share-count CAGR from EDGAR financials (net debt / FFO and fixed-charge coverage for REITs; regulatory-capital framing for financials).
• Peer cohorts: per-segment comparables with deep-linkable SEC filing citations.

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

International Seaways Q4 2025 results, 8-K · International Seaways FY2025 results, 8-K · International Seaways results, 8-K · International Seaways FY2025 results, 10-K · International Seaways Q1 2026 results, 8-K