SFL Corporation Ltd Minor model adjustments
We have updated our estimates following the Q4 report, revised our timing of Offshore earnings, slightly adjusted our opex estimates, and updated our model for the announced capex and changes to SFL’s debt portfolio. While DPS has been raised the past two quarters, we still see potential for a further increase – from USD0.26 for Q4 (USD0.25 for Q3) – on a potential extension for the Hercules rig at attractive rates. Also, cash proceeds from vessels with purchase obligations leave cash available for further investment activities supportive of long-term dividends. We do not consider our estimate changes to be material, and we have not changed our HOLD recommendation. We reiterate our USD12.0 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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