Statoil (Buy, TP: NOK178.00) - Q4e consensus EPS c40% too low
We are 21% and 41% above Q4 consensus EBIT and EPS, respectively, and believe consensus is under-estimating record-high Q4e Norwegian gas production and sharply increasing European gas prices, which is an optimal combination for Statoil in our view. With Russian and Norwegian gas exports to Europe at record-highs and Asian LNG imports surging, we believe European gas prices could spike this winter. Statoil has the highest exposure to European gas prices among its peers. The Q4 results are due on 7 February. We reiterate our BUY recommendation and NOK178 target price.Equinor is engaged in oil and gas exploration and production activities. Co. is primarily focused on exploration, development and production of oil and gas on the Norwegian continental shelf (NCS). Co.'s operations are organized into four segments. The Development and Production Norway and Development and Production International segments explore, develop, produce and extract crude oil, natural gas and natural gas liquids. The Marketing, Processing and Renewable Energy segment markets, trades, transports and processes oil and natural gas and renewable energy. The Other segment consists of global well and project delivery, research and develpoment, and business development.
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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