MPC Container Ships (Hold, TP: NOK22.00) - HOLD on ongoing trade tensions
We have cut our estimates ahead of the Q2 results (due at 08:00 CET on 30 August), leaving us 29% below Bloomberg consensus on 2020e EBITDA and 43% below for 2021e. We fail to identify any near-term share price catalysts for a re-pricing of the stock, based on our view of an escalating and protracted US-China trade war. While H2 rates could get a lift from IMO 2020 disruption, we see risks to the group’s older assets in 2020 and a stricter regulatory regime. Hence, we have downgraded to HOLD (BUY) and cut our target price to NOK22 (NOK44).
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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