DHT Holdings Minor model adjustments
We have updated our estimates, owing to DHT’s solid Q4 earnings and lucrative Q1 fixtures. VLCC charter markets have seen improved liquidity in recent weeks, including reports of DHT Puma being relet out 2024 at USD55k/day, with similar fixtures being made for lower-spec vessels. Including its fixed charter coverage, at these rates DHT would earn USD330m of EBITDA annually, resulting in ~USD1.15/share (~11% yield) dividend capacity on our estimates. The stock is trading at a 12–19% dividend yield on 2024–2025e, and we believe the potential remains to the upside given the favourable supply-side fundamentals in the VLCC space. We do not consider these changes to be material and we have not changed our BUY recommendation. We have raised our target price to USD12.7 (12.5).
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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