Episode Details

Flex LNG (FLNG) Q2 2026 — Flex LNG released Q2 2026 BEFORE THE OPEN on Wednesday August 19 (Form 6-K 0001628280-26-057820, EDGAR acceptance 02:22 ET; webcast 9:00 AM ET). Shares closed USD31.10 on Aug 18, OPENED USD32.52 (+4.57 pct) and traded USD32.29 (+3.83 pct) at 1:48 PM ET on 1.64x volume - INTRADAY. Flex LNG owns thirteen modern LNG carriers built 2018-2021, all MEGI or X-DF propulsion. Bermuda-incorporated, NYSE-listed, reporting in US GAAP and US dollars. Q2 2026 vessel operating revenues were USD106.8M on a USD86,119 a day time charter equivalent rate, the best since Q4 2021. THE CALL: AVOID (4/5, HIGH - A GOOD FLEET FUNDING A DIVIDEND IT DOES NOT EARN) — base-case value ~$19.97 vs ~$32.29 today. KEY METRICS: - CALL: AVOID, 4/5. Fair value USD19.97 vs USD32.29 (-38.2 pct). Bear USD12.26 / base USD20.33 / bull USD26.96, weighted 25/50/25. Free cash flow to equity after cash interest, drydocking and scheduled amortisation, with an ASSET-BASED terminal value (USD185M a ship in 2030) rather than a growth tail, discounted at 10.5 pct over 54.1M shares. - THE PRINT: vessel operating revenues USD106.8M (USD102.7M ex EU allowances) vs a USD93.5M bar, +14.2 pct. Adjusted basic EPS USD0.79 vs a USD0.624 bar, a +26.6 pct beat. US GAAP EPS was USD0.83 - HIGHER than adjusted, because the adjustment strips a USD2.4M UNREALISED swap gain. Time charter equivalent USD86,119 a day, +31 pct. Adjusted EBITDA USD79.0M. - THE ANGLE: first-half cash from operations was USD86.5M against USD81.1M of dividends paid and USD55.5M of contractual debt repayment - USD136.7M of uses. Operations covered 63 pct. The shortfall was USD50.2M, and cash fell USD50.3M, from USD447.6M at the year end to USD397.4M at 30 June. The bridge ties to about USD130,000. - NOT A ONE-OFF: from the filed 20-Fs via SEC XBRL, cash left after scheduled debt repayment covered 35 pct of the dividend in 2023, 50 pct in 2024 and 22 pct in 2025 - 36 pct across the three years together. The gap was funded with USD1.61bn of new long-term debt. Contributed Surplus, the Bermuda account dividends are paid from, fell USD221.3M to USD140.1M in six months. - TESTED AND REJECTED: the beat was NOT a derivatives mark - only USD2.4M of the USD4.7M gain is unrealised, about four cents a share. Nor is the cash gap a timing artefact: Q1 operating cash flow was USD9.7M and Q2's USD76.8M, but half-year working capital nets to plus USD0.5M. Guidance was MAINTAINED at USD73,000-78,000 a day, not raised, after printing USD86,119. - WHAT YOU PAY: 2.49x book, 11.7x guided EBITDA, net debt 5.2x that. The reverse solve says the price needs each of the thirteen ships worth USD262M in 2030 - above the USD250M Flex quotes for a NEW Korean vessel delivering 2029. Backlog is 51 years firm, but 29 pct sits in one ship fixed to 2041; the median has 2.7 years and 4 of 13 roll off by early 2027. - THE STREET: 6 analysts, ZERO buy ratings, consensus SELL, average target USD25.88 (low USD24.40, high USD30.00; S&P Global, updated 14 May 2026). The tape trades 25 pct ABOVE that average. Kepler Capital cut to Sell USD25 on 14 May 2026; Pareto Securities to Sell USD25 on 13 May 2026; Jefferies Hold USD23 dated 20 Aug 2025. We sit 23 pct below the Street. What to watch: UP: Flex Artemis and Flex Volunteer fixing multi-year near the USD75,000 five-year term rate; slippage in the 95 carriers due in 2027. DOWN: the two open ships fixing into the USD50,000-70,000 spot market; the USD775M of swaps at 2.46 pct rolling off with 2.3 years left. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.