D/S Norden (Buy, TP: DKK138.00) - Positioned for 2020
We have updated our model for the Q3 results, reducing our 2019e EBITDA by 6% while lifting our 2020e EBITDA by 1%. We now expect an adjusted net profit in 2019e of USD13m, towards the low end of Norden’s guidance (USD10m–45m), but this figure should increase to USD116m in 2020e. Norden has fixed 19% of its available product days in 2020, positioning it well for improving tanker markets. We reiterate our BUY while we have lowered our target price to DKK138 (143).Dampskibsselskabet Norden is a holding company. Co., through its subsidiaries, is an internationally operating shipping group. Co. operates a fleet of 238 vessels. In dry cargo, Co. operates in Panamax and Handymax, in addition to growing activities in Handysize and Post-Panamax vessel types as well as activities in Capesize. In tankers, Co. activities comprise Handysize, MR and LR1 product tankers. Co.'s product tankers are commercially operated under the 50%-owned Norient Product Pool. Co.'s core fleet consists of owned vessels and vessels on long-term charter with purchase option, the core fleet is supplemented by vessels chartered on a short-term basis or for single voyages.
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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