LPG

Dorian is a high-quality but deeply cyclical operator of Very Large Gas Carriers. FY2026 was a strong recovery year: revenue grew 36.3% to $482M, net income more than doubled to $194M, and diluted EPS jumped 112% to $4.54, driving best-in-class margins (43.6% operating, 40.2% net) and a 17.0% ROE. The balance sheet is genuinely strong — $327M cash, long-term debt down 7.7% to $460M, liabilities/equity of just 0.64x — and management is actively returning capital: $105M in dividends, a $1.00/share ($42.8M) irregular dividend declared May 2026, a $16.5M debt prepayment, and an $81.9M vessel sale. At a 7.8x P/E and 3.1x sales, the stock looks optically cheap.

The problem is what that low multiple is telling you. The five-year revenue/net-income history is a sawtooth, not a trend: net income ran $71.9M → $172M → $307M (FY2024 peak) → $90.2M (FY2025 trough) → $194M (FY2026). Earnings collapsed by roughly 70% from peak to trough in a single year, and FY2026's recovery still sits well below the FY2024 high. The MD&A confirms the engine of this volatility — all 27 VLGCs are deployed in the Helios Pool (99% of revenue), almost entirely spot/short time-charter exposure with 'none of our vessels currently on a fixed time charter outside of the Helios Pool.' Earnings are essentially a leveraged bet on VLGC spot rates, and the trailing 7.8x P/E is calculated on what may be near-cyclical-peak earnings, the classic value-trap setup for shippers.