Shelf Drilling (Buy, TP: NOK35.00) - Set for another transition quarter
Burdened by start-up capex and delayed start-ups in Nigeria, we consider Q3 to be another transition quarter for Shelf Drilling, until an improvement in cash flow generation becomes apparent, likely from mid-2020. With respect to future backlog additions we await news related to its four roll-overs with Saudi Aramco in early 2020 and further clarity on future programmes in Nigeria. We maintain our BUY and NOK35 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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