Archer (Hold, TP: NOK9.00) - Too much consensus optimism
Despite the value-creating refinancing earlier this year and ongoing efforts from new management, we struggle to get excited about Archer’s valuation. We believe there is too much optimism among consensus in 2018–2019e earnings expectations as well as regarding valuation and the monetization potential of its 36% Quintana (QES) stake. For QES, we have trimmed our EV forecast to USD350m (USD400m), which we believe is well below consensus. HOLD recommendation retained with a NOK9(10) 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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