Will KNOT Offshore Partners (KNOP) Stock Be Helped By Pricing Of Public Offering?

NEW YORK (TheStreet) --KNOT Offshore Partners LP (KNOP) announced on Tuesday the pricing of its public offering of 4.6 million of common units at a price of $28.43 per share.

Shares of KNOT Partners, a limited partnership formed to own, operate, and acquire shuttle tankers, are down -6.39% to $27.98 in early morning trading.

Underwriters were granted a 30-day option to buy up to an additional 690,000 common units.

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Net proceeds from the sale will be used to fund the company's acquisition of two shuttle tankers.

Separately, TheStreet Ratings team rates KNOT OFFSHORE PRTNRS LP as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:

"We rate KNOT OFFSHORE PRTNRS LP (KNOP) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been very high debt management risk by most measures."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The debt-to-equity ratio of 1.22 is relatively high when compared with the industry average, suggesting a need for better debt level management.
  • In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, KNOT OFFSHORE PRTNRS LP's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The gross profit margin for KNOT OFFSHORE PRTNRS LP is currently very high, coming in at 78.88%. Regardless of KNOP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KNOP's net profit margin of 29.51% significantly outperformed against the industry.
  • KNOT OFFSHORE PRTNRS LP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This year, the market expects an improvement in earnings ($1.55 versus $0.87).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 302.9% when compared to the same quarter one year prior, rising from -$3.17 million to $6.42 million.
  • You can view the full analysis from the report here: KNOP Ratings Report
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