Panoro Energy (Buy, TP: NOK38.00) - Just the beginning
With most operational and financial metrics pre-announced, the financial numbers were secondary in Panoro’s Q3 results. More importantly, the company outlined its capital allocation framework, targeting 2023 dividends of USD20m–30m at >USD80–90/bbl realised oil price. In our view, there is potential for meaningful dividend growth, as 2023 remains a year in which Panoro needs to focus on balance sheet management and deal with large working capital fluctuations, which should be mitigated by FCF generation and strong production growth into 2024e. We reiterate our BUY and NOK38 target price.Panoro Energy is an international independent oil and gas company engaged in the exploration and production of oil and gas resources in Brazil and West Africa. In Brazil, Co. participates in a number of oil and gas licenses located in the Santos basin outside the south-east coast of Brazil and in the Camamu-Almada basin in the state of Bahia. In West Africa, Co. participates in a number of licences in Nigeria and Gabon. As of Dec 31 2013, Co.'s commercial production is from the Manati field in Brazil.
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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