Stolt-Nielsen (Buy, TP: NOK500.00) - Solid outlook for 2024e earnings
We believe the currently record-high chemical freight market backed by an appealing orderbook-to-fleet ratio of c6% could be establishing a new ‘normal’ for rates a higher level and see further upside potential for rates on a strong MR freight market limiting swing tonnage, and with tailwinds for tonne-miles demand on Red Sea disruptions. Hence, we find Stolt-Nielsen attractively valued at an average 2024–2025e EV/EBITDA of 4.0x and P/E ratio of 6.0x versus the tanker peer group at 4.6x and 6.6x, respectively. We reiterate our BUY and have raised our target price to NOK500 (485).Stolt-Nielsen is a holding company. Co. through its subsidiaries is engaged in maritime industries. Co.'s operating units include Stolt Tankers, providing transportation services for bulk liquid chemicals, edible oils, acids, biofuels and clean petroleum products; Stolthaven Terminals, offering storage for bulk liquid chemicals, edible oils, acids, biofuels and clean petroleum products; Stolt Tank Containers, operating a fleet of tank containers for shipments of bulk liquid chemicals, food-grade products and bitumen via road, rail and container ship, as well as Stolt Sea Farm, focused on the production of fish including turbot, sturgeon, sole and caviar.
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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