Teekay Tankers (Buy, TP: USD74.00) - Soon time to prune the discount
We believe Teekay Tankers offers attractive tanker exposure, with limited downside risk, trading at a 45% discount to steel values. We estimate FCFE (including current cash) of USD40/share by end-2026, or 85% of the current share price. Conservatively assuming fleet scrap value at end-2026 implies 10% upside potential to the current share price, increasing to 80% on today’s asset values. We reiterate our BUY, but have trimmed our target price to USD74 (75).
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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