Archer (Buy, TP: NOK1.60) - Look to 2025
The 2024 guidance was solid, in our view, with USD137m EBITDA at mid-point, which should allow deleveraging from 3.4x net debt/EBITDA in 2023e to 2.7x in 2024e. However, we believe investors considered the higher 2024e capex and Argentina expansion to be on the downside. On tangible growth in 2025e (Fulmar contract with Repsol), we have raised our 2025e EBITDA by 5% (13% YOY growth), supporting a 2025e EV yield of c20%. Achieving normalised capex and lower cost of debt would be key to closing the gap to our NOK2.2/share SOTP. We reiterate our BUY and NOK1.6 target price.
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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