D/S Norden (Buy, TP: DKK139.00) - Fewer assets, more tanker days
We have adjusted our model for D/S Norden and revised our rate estimates post the Q1 results, prompting upward revisions to our forecasts. We are now above the mid-point of guidance for 2019 adjusted net profit, but below Bloomberg consensus. D/S Norden continues to evolve from being a dry bulk owner to an asset-light operator with increasing tanker exposure, which is positive in view of our sector outlook to 2020. We reiterate our BUY, and have raised our target price to DKK139 (115).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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