Teekay Tankers (Buy, TP: USD23.00) - Doing what it said it would
At its investor day in November, Teekay Tankers announced that reducing leverage and selling assets would be a core part of its strategy for the next few years. This week, it announced the sale of three 2003-built Suezmax and a part of its support service business, in addition to signing a five-year debt facility of USD533m for 31 vessels. The initiatives generate USD73m in liquidity, giving optionality to pay down debt while still paying dividends from a strong market. Our Q4e EBITDA of USD134m is 2% above consensus; results are expected by 21 February 2020. We reiterate our BUY and USD23 target price after a change of analyst.
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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