Golden Ocean (Sell, TP: NOK98.00) - Testing times ahead
Asset values are diverging from softer freight markets, with broker quotes for a 5-year Capesize vessel implying an 11x EV/EBITDA on current 1-year TCs. Further, we estimate that average Capesize index rates for 2025 would be required to be ~USD27k/day (48% above our estimate, 22% above current 1-year TCs) for Golden Ocean to reach a decent ~12% dividend yield on the current share price. Thus, we believe risk remains skewed to the downside and we reiterate our SELL. We have cut our target price to NOK98 (136).
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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