Avance Gas (Hold, TP: NOK31.00) - Waiting out the high season
Avance reported a strong TCE for Q2 and provided decent guidance for Q3, as well as operational updates that clearly indicate management is confident the company is through the worst (new TC deal, more scrubbers). We have raised our 2019–2020e EBITDA by 6% on average following the report. However, as we see August as the start of a 6-month down-cycle, we await a better entry point. We therefore reiterate our HOLD recommendation, while we have lifted our target price to NOK31 (30).Avance Gas Holding is principally engaged in the transportation of Liquefied Petroleum Gas ("LPG"). Co. operates a fleet of 14 Very Large Gas Carriers, providing transportation services to oil majors and traders of LPG on a global basis. Co. transports LPG from the Middle East and the U.S. Gulf or U.S.loan facility from BCBloan facility from BCB(excludes dividends satisfied by issue of shares) East Coast to destinations in Europe, South America and Asia.
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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