OKEA (Buy, TP: NOK29.00) - Set to end the year on a high
Q3 production was a solid 37.2kboed, above our 33.2kboed estimate (no reliable consensus). Despite OKEA recording another net impairment charge, we do not see this having any meaningful effect on its dividend capacity for 2025e. On our estimates, the company would have a positive LTM net profit and a net cash position by year-end, which should set the stage for a recovery and a narrowing of the NAV discount. We reiterate our BUY but have raised our target price to NOK29 (28), as we have increased our 2024 production estimate.Okea ASA is a Norway-based oil company engaged in the oil and gas exploration and production industry. The Company contributes to the value creation on the Norwegian continental shelf with development and operation systems through the utilization of the result of previous and ongoing exploration activities in order to bring undeveloped oil on stream in strategic cooperation with service companies. Its services do not involve the exploration for petroleum. The Company operates an office in Trondheim, Norway.
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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