Scorpio Tankers (Hold, TP: USD11.00) - Liquidity in focus
Q3 results were soft, while the Q4 rate guidance offered a glimpse into a rapidly deteriorating product tanker market. However, Scorpio Tankers has a modest capex schedule and no major debt maturities through 2021e, which coupled with its recent refinancing initiatives yields headroom on our estimated spot rates throughout our forecast period, as we estimate a fleet-wide cash breakeven of USD17.1k/day. We reiterate our HOLD and USD11.0 target price.
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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