Dorian LPG LPG
Energy · Oil & Gas Midstream · Synthos Deep Dive · 2026-07-06
The Overview
Dorian owns a fleet of giant ships (VLGCs — Very Large Gas Carriers) that haul liquefied petroleum gas — mostly propane — across oceans, chiefly from US export terminals to Asia. When shipping rates are high, the company mints money; when rates fall, profits can drop by two-thirds in a single year. That is exactly what its history shows.
Right now rates are good: last fiscal year profits more than doubled, the final quarter smashed expectations, and the company pays a dividend yielding almost 8%. The stock also looks very cheap — about 8 times earnings. So why aren't we buying?
- Downside Risk 7/10 (high). "Cheap" cyclicals are often cheapest-looking right before earnings fall. Three years ago EPS was $7.63; the next year it was $2.14. Company insiders have been sellers recently, and the stock just broke below its 50-day trend line.
- Growth Quality 4/10 (below average). The fat profits come from freight rates, not from a growing business — analysts expect revenue in 2028–2030 to be lower than it was in fiscal 2024.
- Exponential Potential 2/10 (very low). A fixed fleet hauling a commodity cannot compound. This is an income-and-cycle trade, not a wealth-multiplier.
The one big worry: LPG freight rates are set daily by a volatile spot market. If the rate cycle turns — new ship deliveries, a trade disruption, an arbitrage window closing — earnings and the dividend shrink together, and there is nothing management can do about it.
Putting a number on it: our fair-value estimate is $44 against a current price of $49.78 — consistent with our call to stay away or wait for a better setup.
Our summary metrics
Spot VLGC freight is brutally cyclical (EPS $7.63 → $2.14 → $4.55 in three years), $1.6B small cap, net-debt/EBITDA 1.30×, a related-party pool structure, and a cluster of insider sales at $35–45 — the 0.78 beta badly understates cargo-rate risk.
Fat TTM margins (net 40.5%) and ROIC ~11% are rate-driven, not structural — FY28–FY30 revenue estimates ($405–432M) sit BELOW FY24's actual $561M; this is mean-reversion, not growth.
A fixed fleet hauling a commodity at spot rates — no acceleration, no compounding TAM; estimates themselves pencil FY28 EPS nearly halving. The opposite of an exponential.
What does “fair value” mean?
Fair value is Synthos’s estimate of what one share is worth today, based on our model of the company’s future cash generation and the risks to it. It is not a price target or a prediction of where the stock trades next quarter — it’s the price where we think risk and reward are balanced. Above it, you’re paying for outcomes better than our base case; below it, the market is offering a margin of safety.
The model’s inputs and weightings are proprietary — they’re the product. What we publish is the output, plus an independent, public-math cross-check further down the page (“Check our number”) so you can judge it for yourself.
What do the 5 tiers mean? (Core · Tactical · Watch · Hold · Avoid)
Exponential Potential
A fixed fleet hauling a commodity at spot rates — no acceleration, no compounding TAM; estimates themselves pencil FY28 EPS nearly halving. The opposite of an exponential.
What could take this further than the base case — and where the market may be underpricing it. Full forward-growth and acceleration math in Deeper analysis, §4 below.
Deeper analysis
Technicals, fundamentals, valuation, and the full expert-claim evidence panel — the detail behind the numbers above.
Reference table
| Street consensus | $55 — but that is a single price target (high = low = median = $55); 4 Buy · 5 Hold · 0 Sell, consensus "Hold" — context, not our anchor |
| Valuation | 8.3× trailing EPS · 8.8× FY26A / 5.3× FY27E · EV/EBITDA 6.8× · P/B 1.41× (all-tangible book $26.74/sh) · FCF yield 11.8% |
| Dividend | $2.95/sh TTM ≈ 7.8% yield, ~54% payout — irregular by design (rate-linked), not a promise |
| Technicals | Deteriorating — below the 50-DMA ($40.47), RSI 26 (oversold), MACD −1.44, −20.8% off the 52-wk high ($47.72), though still +57.9% off the low and above the 200-DMA ($32.37) |
| Conviction | None — 0 expert-panel claims on the company; 1–2 sell-side analysts per estimate year. You are on your own here, and we say so. |
| Position sizing | If triggered: satellite, ≤1–2%, income/cyclical sleeve — never a core anchor |
What the experts actually said
No independent expert claims in the Synthos knowledge base yet for LPG — this dive is fundamentals- and technicals-driven, not panel-driven.
Price & moving averages 12 months · 50 & 200-day averages · 52-week range
Solid line = price · dashed line = 50-day average · dotted line = 200-day average · the two thin horizontal lines mark the 52-week high and low. Price above both averages is an uptrend.
Data summary: last close $49.78, 15% above the 50-day average ($43), 40% above the 200-day average ($36) — an uptrend. 3% below the 52-week high of $51, 108% above the 52-week low of $24.
Bollinger Bands 20-day average ± 2 standard deviations
The shaded band widens when the stock gets more volatile. Riding the upper edge = strong momentum (sometimes stretched); the lower edge = weak / potentially oversold.
Data summary: price $49.78 is currently inside the band (band $42–$53).
RSI (14) momentum gauge · 0–100
Above 70 (overbought zone, shaded) = overbought, below 30 (oversold zone, shaded) = oversold. Currently 60.
MACD 12 / 26 / 9 · trend & momentum
The MACD line crossing above the signal line (bars flip to the up color) = momentum turning up; crossing below (bars flip to the down color) = turning down. Bar height = the size of that gap.
Data summary: MACD is currently above its signal line by 0.02, positive momentum.
Relative performance vs S&P 500 & its sector (XLE (sector)), set to 100 a year ago
Solid = LPG · dashed = S&P 500 · dotted = XLE (sector). A rising line means it is beating that benchmark — the sector line shows whether it is a leader or laggard within its own group.
Forward revenue & earnings actual → estimate · "FY" = fiscal year, "E" = estimate
Darker bars = actual results, brighter = analyst estimates. Taller bars to the right = expected growth.
Key stats an RIA wants
1. What it is
Dorian LPG Ltd. (NYSE: LPG) is a pure-play owner and operator of Very Large Gas Carriers (VLGCs) — the largest class of ships that transport liquefied petroleum gas (propane/butane), primarily on the long-haul US-Gulf-to-Asia and Middle-East-to-Asia routes. Established 2013, IPO May 2014, headquartered in Stamford, CT; CEO John C. Hadjipateras; ~577 employees; Marshall Islands incorporation (hence the 0% income-tax line across every year in the filings). The profile in our data file states the operational fleet was twenty-two VLGCs as of May 27, 2022 — that fleet count is dated, a gap we flag rather than paper over.
Revenue mix (from the segment filings, latest available FY2023): essentially one business — "Net pool revenues — related party" $364.5M of $389.7M total, plus time-charter revenues $22.7M and other $2.5M. The "related party" label matters: most of the fleet earns through the Helios LPG Pool, a joint marketing pool, so reported revenue is a net share of pool earnings rather than direct voyage billing. Segment data beyond FY2023 is not in our file — another honest gap.
The economic engine is simple: fleet size is roughly fixed, so revenue ≈ spot VLGC freight rates × utilization, and with high fixed costs and cheap fixed-rate debt, rate swings flow through to EPS with enormous leverage in both directions.
2. The expert thesis (traceable)
No expert-panel coverage — this note is fundamentals-driven. The Synthos KB contains zero claims on Dorian LPG the company. A search for "LPG" surfaces only two macro claims about LPG the commodity — geopolitical_cousins (2026-03-05, conviction 72–75, skill 1.0) arguing India is exposed because ~90% of its LPG imports transit Hormuz while it loses its discounted Russian-crude tailwind (geopolitical_cousins-yAU4gHSClcY:3390273088, geopolitical_cousins_m-yAU4gHSClcY:89d1b90c72). That is tangential context, not a thesis on this stock — and note a Hormuz disruption would cut both ways for a shipowner: freight-risk premia and re-routed ton-miles up, but cargo volumes at risk.
Sell-side coverage is nearly as thin: 1–2 analysts per forward estimate year, and the "consensus" price target of $55 is a single target (high, low and median are all $55). This is the honest house standard for screen-surfaced names: the verdict below rests on the filings, the estimates and the price action — nothing else — and the absence of informed voices is itself a reason for conservative sizing.
3. Synthos scores & the Bull / Base / Bear cases
| Score | 0–10 | The read |
|---|---|---|
| Downside Risk (lower = safer) | 7 · High | The balance sheet is fine (net-debt/EBITDA 1.30×, current ratio 2.67, interest coverage 7.1×) — the risk is the business: spot-rate EPS whiplash ($7.63 → $2.14 → $4.55 across FY24–FY26), a $1.6B small cap, a related-party pool structure, thin analyst coverage, a cluster of insider sales at $35–45, and a tape that just lost its 50-DMA with RSI 26. The 0.781 beta measures correlation, not danger. |
| Growth Quality | 4 · Moderate | TTM net margin 40.5%, ROE 17.9%, ROIC 11.3%, income quality 1.09 (cash confirms earnings) — genuinely profitable today. But it is all rate, no compounding: consensus revenue for FY28 ($410M), FY29 ($405M) and FY30 ($432M) is below FY24's actual $561M. Zero R&D, no pricing power, no operating flywheel. |
| Exponential Potential | 2 · Low | Fixed fleet × commodity spot rates = no second derivative to own. Consensus pencils FY27 EPS spiking to ~$7.15 then falling ~47% to $3.81 in FY28 and staying flat. Room-to-run logic does not apply to a ship pool. |
The three cases (our own scenario model — assumptions labeled; ~12–18-month fair values, no false-precision probability blend):
| Case | Key assumptions | Fair value |
|---|---|---|
| Bull | The FY27 rate spike lands as the two covering analysts model (EPS ~$7.15, rev ~$598M) and rates stay firm into FY28; the market pays ~8× spike earnings, aided by the ~7.8% yield. Roughly the lone Street target ($55). | ~$57 (+51%) |
| Base (our anchor) | Rates stay decent through FY27 then normalize as consensus says; value it on mid-cycle EPS ~$4.65 (average of FY23–FY26 actuals: $4.31, $7.63, $2.14, $4.55) at ~9.5× — equivalently ~6.2× FY27E or ~1.65× tangible book — while collecting the dividend. | ~$44 (+16%) |
| Bear | The cycle rolls early (FY25 rerun: EPS ~$2), the dividend is cut with it, and the stock de-rates to ~1.0× tangible book ($26.74/sh) — where asset value, not earnings, sets the floor. | ~$27 (−29%) |
Synthos fair value = the base case, ~$44 (+16%) — deliberately below the $55 "consensus," because that consensus is one analyst's target struck off spike-year earnings. The FMP composite rating is A (overall 4/5, DCF score 5/5) — a fair mechanical read of the cash flows, but mechanical models capitalize peak rates; we won't. This is a tracked call — the Forecaster Scorecard grades it once it matures.
4. Exponential Potential
Synthos separates compounders from exponentials. Dorian is neither — it is a cyclical income vehicle:
- Forward growth is a spike, then a give-back: consensus revenue $481.5M (FY26A) → $597.6M (FY27E, +24%) → $409.6M (FY28E, −31%) → $404.5M (FY29E) → $432M (FY30E). EPS: $4.55 → ~$7.15 → ~$3.81 → ~$3.81 → (no FY30 EPS estimate — 0 analysts).
- The second derivative is negative by construction: the estimate curve peaks in FY27 and mean-reverts. There is no accelerating adoption curve here — only a freight cycle.
- No room-to-run mechanics: a shipowner grows by buying ships, at cyclical prices, with debt — capex was $93.8M in FY26 (~19% of revenue) and the fleet count is structurally bounded. FY28–FY30 revenue below FY24 actuals is the tell.
- What you do get: an 11.8% FCF yield and a 7.8% TTM dividend yield while the cycle lasts.
Exponential Potential: Low (2/10). Own it (if at all) for cycle-and-income, never for compounding.
5. Financials (real numbers — FMP annual/quarterly)
- Revenue: FY26 (ended 2026-03-31) $481.5M, +36.3% (FY25 $353.3M, which was −37.0% off FY24's $560.7M). Five-year path: $315.9M → $274.2M → $389.7M → $560.7M → $353.3M → $481.5M — a sine wave, not a growth line.
- Quarterly trajectory (FY26, strong finish): Q1 $84.2M (EPS $0.24) → Q2 $120.6M ($1.30) → Q3 $120.0M ($1.11) → Q4 $153.3M ($1.90). The Q4 print (2026-05-20) beat by ~34% on EPS ($1.89 reported per the earnings calendar vs $1.41 est) and ~19% on revenue — after three straight quarters of misses (Q1 $0.27 vs $0.61 est; Q2 $1.31 vs $1.45; Q3 $1.11 vs $1.15).
- Margins (TTM): gross 57.5%, EBITDA 61.3%, operating 43.7%, net 40.5% — spectacular, and spectacularly rate-dependent (FY25's same lines were far thinner on $353M of revenue).
- Earnings quality — good: income quality 1.09 (operating cash flow exceeds net income), zero goodwill/intangibles, SBC only 2.3% of revenue, and a 0% tax rate (Marshall Islands) that is structural, not a gimmick. FY26 net income $193.7M / EPS $4.55 is clean.
- Cash flow: FY26 operating CF $210.1M, capex −$93.8M (up sharply from FY25's $18.9M — fleet investment), FCF $116.3M. Dividends paid $105.0M; buybacks a token $7.0M. Note FY25 included an $89M stock issuance while paying $156M of dividends — capital recycling worth watching (§9).
- Balance sheet: cash $327.4M, total debt $709.6M (of which $148.7M capital leases), net debt $382.2M, net-debt/EBITDA 1.30×, equity $1.139B — and with zero goodwill, book is all-tangible: $26.74/share. Current ratio 2.67, interest coverage 7.1×. Solid for a shipowner.
6. Valuation — priced in or room?
The stock screens very cheap: 8.3× trailing EPS, 6.8× EV/EBITDA, 1.41× tangible book, 11.8% FCF yield, 12.0% earnings yield, 7.8% dividend yield; the Graham number computes to $52.30. FMP's mechanical rating is A (DCF score 5/5). The honest counterpoint: cyclicals are supposed to look cheap at high rates — the market is refusing to capitalize spike earnings, and consensus agrees, penciling FY28 EPS down ~47% from the FY27 estimate. On forward numbers the multiple is 8.8× FY26A → 5.3× FY27E → ~9.9× FY28E: the multiple "cheapens" into the spike and re-expands right back as rates normalize. Street context is unusually weak here: one price target ($55 across high/low/median) and a 4-Buy/5-Hold/0-Sell "Hold" consensus. Our $44 base case values it on mid-cycle earnings (~$4.65 at ~9.5×, ≈1.65× tangible book) rather than on either the trailing print or the FY27 spike — the difference between "cheap" and "correctly priced for a cycle" is the whole debate on this name.
7. Technicals (from the tech block)
- Trend: cracking. $37.78 is below the 50-DMA ($40.47) and MACD is −1.44 (negative) — but still comfortably above the 200-DMA ($32.37), so the longer uptrend is intact.
- Location: −20.8% off the 52-week high ($47.72) — near the max drawdown from peak of −26.2% — and +57.9% off the 52-week low ($23.93).
- Momentum: RSI(14) 26 — genuinely oversold. Sell-offs this stretched often bounce, but oversold in a broken short-term trend is a warning as much as an invitation.
- Relative strength: +46.7% 12-mo vs SPY +21.1% / QQQ +31.2% and +55.2% 6-mo vs SPY +10.2% — big outperformance on the long lens — but +9.1% 3-mo vs SPY +14.6%: the stock has gone from leader to laggard this quarter.
- Read: a momentum name that lost its momentum. The screen that surfaced it was looking at the 6–12-month lens; the last three months say distribution. This is the core of the Watch call: either the 50-DMA (~$40) is reclaimed (trend repair) or the 200-DMA (~$32) gets tested (better price). Chasing the middle at $38 offers neither confirmation nor margin.
8. Moat & competitive position
There is no moat in commodity shipping — VLGC freight is a global spot market and Dorian is a price-taker. What Dorian has instead are competitive attributes: a modern pure-play VLGC fleet, scale economics through the Helios pool (shared marketing/utilization — at the cost of related-party opacity), a conservative balance sheet (1.30× net-debt/EBITDA buys staying power through troughs), and US-listing liquidity. The cycle itself is the "asset": VLGC supply (newbuild deliveries) versus US/Middle-East LPG export volumes and ton-mile demand sets rates, and none of that is in management's control.
Peer set (FMP-supplied, market cap): a loose energy-transport basket rather than clean comps — FLEX LNG $1.62B, Navigator Holdings $1.23B (the closest true comp — smaller gas carriers), Dorchester Minerals $1.22B, Global Partners $1.60B, MRC Global $1.17B, NESR $2.79B, NPK International $1.19B, RPC $1.22B, Vermilion Energy $1.34B, Bristow $1.25B. The most relevant VLGC comparators (BW LPG, Avance Gas) are not in the supplied list — judge LPG against the gas-carrier cohort, not this grab-bag.
9. Management, capital allocation & guidance
- Capital allocation: shareholder-heavy and rate-linked — FY26: dividends $105.0M (on $116.3M FCF), buybacks $7.0M, net debt roughly flat (+$8.4M issuance); FY24–FY25 paid out $162M and $156M respectively. The wrinkle: FY25 issued $89M of stock while paying those dividends — recycling equity into fleet capex while keeping the payout. Not damning, but it means the dividend is partly financed capital return, and it is irregular by design (rate-linked), not a bond coupon.
- Insider activity — a negative tell: three sales in six weeks per the Form 4 feed: CCO Tim Hansen sold 20,000 shares at $35.38 (2026-06-30, filed 07-01), director Christina Tan sold 5,708 at $44.08 (2026-06-11), director Ted Kalborg sold 15,373 at $45.06 (2026-05-22) — against only routine director share awards on the buy/award side (2026-03-31 grants). Insiders selling into the top of the range while the stock breaks trend is worth exactly the weight we give it: a caution flag, not proof.
- Guidance: no management guidance is captured in our data file (no KB management claims, no guidance fields) — VLGC owners rarely guide, since they cannot forecast their own spot rates. We say so rather than invent it.
10. Catalysts & what to watch
- Next earnings: 2026-07-31 (Q1 FY27; Street EPS $2.25, revenue ~$170M). Those estimates imply the FY27 rate spike is already assumed — an in-line print confirms the bull path; a miss the size of last year's Q1 (reported $0.27 vs $0.61 est) would gut the FY27 EPS spike thesis on day one.
- VLGC spot rates / Baltic LPG assessments: the single variable that is the whole P&L.
- US LPG export volumes & terminal capacity (ton-mile demand) versus the VLGC newbuild delivery schedule (supply) — the cycle's two blades. Not in our data file; monitor externally.
- Hormuz / Red Sea disruption: the one macro thread our KB does touch (geopolitical_cousins, 2026-03-05) — re-routing lifts ton-miles and rates, but a genuine Gulf supply outage cuts cargo volumes.
- Dividend declarations: rate-linked and irregular — the declared amount each quarter is a direct management read on the cycle.
- Insider filings: more selling below $40 would upgrade the caution flag.
Thesis tripwires (what would change the call): upgrade trigger — price reclaims the 50-DMA (~$40) with the Q1 print at/above $2.25; downgrade trigger — a Q1 miss plus a dividend cut, or a decisive break of the 200-DMA (~$32), which would say the FY28 down-cycle is arriving a year early.
11. Key risks
- Rate cyclicality (the dominant risk): EPS $7.63 → $2.14 → $4.55 in three fiscal years, and consensus itself models FY28 EPS −47% off FY27. Everything else is a footnote to this.
- The "cheap" trap: low P/E on peak-cycle earnings is how value investors get hurt in shipping — the multiple is lowest exactly when forward earnings are most at risk.
- Dividend fragility: $2.95 TTM (~7.8%) is rate-linked and irregular; FY26 payout was ~90% of FCF. A rate rollover cuts the dividend with it.
- Insider selling: CCO + two directors selling at $35–45 within six weeks of a trend break.
- Structural/coverage opacity: related-party pool revenue (Helios), segment data only through FY2023, a fleet count last stated as of May 2022, 1–2 covering analysts, and a one-target "consensus" — the information environment is thin.
- Balance-sheet cyclicality mismatch: 1.30× net-debt/EBITDA is comfortable at these EBITDA levels; on FY25-trough EBITDA ($193M) the same debt was ~2.1× — leverage ratios inflate as the cycle deflates.
- Geopolitical two-sidedness: Gulf disruption can spike rates (good) or destroy cargo volume (bad) — do not assume the friendly branch.
- Tax/regulatory: the 0% Marshall Islands tax rate is a structural benefit that carries perennial (if low-probability) regulatory headline risk.
12. Verdict, position sizing & monitoring
Watch. Dorian LPG is a well-run, cleanly-accounted, conservatively-levered way to own the VLGC freight cycle, and at 8.3× trailing with an 11.8% FCF yield and a 7.8% dividend it is genuinely cheap if rates hold — the two covering analysts even model an FY27 EPS spike to ~$7.15. But three things stop us short of a Buy today: the setup just broke (below the 50-DMA, MACD negative, 3-month relative strength now lagging the S&P), insiders sold into the highs, and the estimate curve itself says FY28 earnings nearly halve — meaning the market's refusal to pay more than 8× is rational, not an inefficiency. With zero expert-panel coverage and one-analyst price-target "consensus," conviction inputs are too thin to override the price action.
- Action plan: do nothing at $38. Buy trigger A (trend repair): reclaim and hold the 50-DMA (~$40) with the 2026-07-31 print at/above the $2.25 EPS estimate. Buy trigger B (better price): a flush toward the 200-DMA (~$32), which is ~1.2× tangible book and would put the base case ~38% above entry with the yield as the carry.
- Sizing if triggered: satellite, ≤1–2%, in the income/cyclical sleeve — sized so a bear-case −29% to ~$27 (1.0× tangible book) is a nuisance, not a wound.
- Monitoring: re-underwrite on the §10 tripwires; formal re-score each earnings print (next 2026-07-31). This verdict is logged as a tracked Synthos call as of 2026-07-06 at $37.78.
- Single biggest risk: a VLGC spot-rate rollover — the entire earnings stream is freight-rate leverage on a fixed fleet, and the down-leg is already in the consensus numbers for FY28.
Provenance & disclosures
- Traceability: 0 KB claims on Dorian LPG the company — no expert-panel coverage; this note is fundamentals-driven, per house standard for screen-surfaced names. The only KB matches on "LPG" are two commodity-macro claims (geopolitical_cousins, 2026-03-05, on India's Hormuz-transiting LPG imports:
geopolitical_cousins-yAU4gHSClcY:3390273088,geopolitical_cousins_m-yAU4gHSClcY:89d1b90c72) — cited as tangential context only.kb_net_convictionis null because there is nothing to aggregate; fabricated conviction is structurally impossible (claim-ID reconciliation). - Data as-of: fundamentals FY2026 (period ended 2026-03-31, filed 2026-05-27) · estimates & prices 2026-07-06 · segment detail only through FY2023 · fleet count as stated in the profile (22 VLGCs as of 2022-05-27 — dated).
- Estimate-thinness caveat: forward figures are FMP analyst consensus built on 1–2 analysts per year (FY30 EPS: zero analysts), and the $55 street target is a single target. Treat all forward numbers as low-confidence.
- Valuation-assumption labels: base case = ~9.5× mid-cycle EPS (~$4.65, the FY23–FY26 average) ≈ 1.65× tangible book; bull = ~8× FY27E EPS $7.15; bear = ~1.0× tangible book $26.74. Our own scenario model, not a Street blend.
- Structure caveat: most revenue flows through the related-party Helios LPG Pool; reported revenue is a net pool share.
- Not investment advice. Independent research, educational and informational only, never personalized. Hypothetical/forward figures are labeled; the only performance numbers Synthos will headline are the live, real-money Flagship's.
- Version: 2026-07-06. Prior versions available via the deep-dive version dropdown ("based on the info at the time").