Genco Shipping & Trading (Buy, TP: USD25.20) - Dreary markets, but still tempting
We have cut our H2e as spot rates have disappointed and the outlook remains cloudy. However, we continue to view Genco’s 0.70x EV/GAV as attractive, implying a 5-year Capesize value of USD33.3m versus the current USD47.5m and all-time low from 2015–2016 of USD23m. At the time, demand growth averaged below 4% p.a. and the orderbook was ~20% of the fleet, versus the current ~6% YTD run-rate and 7.4%, respectively. The effects of this should counter potential demand shortfalls from a near-term softer macro environment or sluggish Chinese economic activity. We reiterate our BUY but have cut our target price to USD25.2 (26.8).
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.