Noble (Buy, TP: USD49.00) - ‘Drilling in cash’
Despite some incremental setbacks for its CJ70 jackups in Norway and our conservative view on estimates, we consider Noble as having the most potential among the offshore drillers for solid cash generation in the years ahead. The USD400m buyback programme is also a good indication that cash flow should be coming shareholders’ way, reinforced by its stated capital allocation priorities for the combined company. We reiterate our BUY and USD49 target price, supported by NAV and its attractive 2024e EV/EBITDA of 3.1x.
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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