DHT Holdings (Buy, TP: USD12.10) - Enviable position in cycle
We expect Q3 earnings to flow down to a healthy 7% run-rate dividend yield in what we estimate will be the softest quarter in 2023–2025. DHT’s QTD fixtures were likely at the low end of consensus, but left significant back-end exposure to the sharp turnaround in VLCC rates in recent days. In our view, the long-term supply story is unchanged, with only ~2% of the on-water VLCC fleet on order, leaving upside optionality on demand on a potential reversal of OPEC+, Saudi Arabian and Russian supply cuts. We reiterate our BUY and have edged up our target price to USD12.1 (12.0).
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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