TOP SHIPS Inc (NASDAQ: TOPS) made a big announcement this morning and investors are excited. The company announced that it has entered into a new time charter contract with BP. Of course, the new contract will generate revenue for the company, exciting investors who are pushing the stock for the top. Today, we’ll talk about:
- The new time charter;
- what we’re seeing from TOPS as a result; and
- what we’ll be watching for with regard to the stock ahead.
TOPS Announces New Time Charter
As mentioned above, TOP Ships is having an incredibly strong start to the trading session this morning after the company announced a new time charter. In a press release issued early this morning, the company said that it has agreed to a new time charter employment contract that will last for a period of 2 years.
The new contract was signed with BP Shipping Ltd and will surround the company’s product/chemical tanker known as M/T Eco Revolution. TOPS said that the time charter will start in January of 2019 immediately after the expiration of the current time charter employment contract on the vessel.
In the release, the company said that it expects that the revenue backlog generated by this new contract will be approximately $10 million.
In a statement, Evangelos Pistiolis, President and CEO at TOPS, had the following to offer:
This charter is a vote of confidence in our high quality asset strategy and our high quality vessel management. Following this fixture, total gross revenue backlog for the fixed charter period of operating vessels, from June 30, 2018, stands at about $221 million, increasing to about $235 million when adding the 50% of our joint venture vessels.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. In the case of TOP Ships, the news proved to be overwhelmingly positive. After all, the new time charter contract will generate around $10 million over the course of 2 years. That’s a good bit of revenue to add to the company’s financial reports. So, it comes as no surprise that excited investors are pushing the stock on a run for the top this morning. As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (8:53), TOPS is trading at $1.98 per share after a gain of $0.27 per share or 15.78% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on TOPS. In particular, we’re interested in following the story surrounding the new time charter as well as the perforance of other time charter agreements the company currently has in operation. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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