Frontline (Buy, TP: NOK305.00) - Sun breaking through the mist
We see strong fundamentals in the tanker space, particularly for VLCCs, driven by limited deliveries and an ageing fleet. Meanwhile, factors such as sanctions and disruption to Iranian oil flows could potentially further benefit compliant shipowners. We believe this leaves Frontline’s modern fleet in a strong position, and if a bull-market were to materialise, we see significant upside potential to our 14–21% dividend yields for 2025–2026e. We reiterate our BUY, but have cut our target price to NOK305 (310).
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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