Teekay Tankers (Buy, TP: USD65.00) - Building financial muscle
Mid-sized tankers are reaching peak performance as Suezmax rates hit USD75k/day. At the same time, we find more upside potential to seaborne volumes from latent Saudi/Russian crude barrels, which could see tanker utilisation max out on the back of full shipyards for the foreseeable future and limited orderbook deliveries. This makes Teekay Tankers, with a USD16k/day cash breakeven from near-zero net debt, an FCF generator accruing an impressive ‘war chest’. We reiterate our BUY and have raised our target price to USD65 (58).
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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