TGS (Buy, TP: NOK200.00) - The devil is in the late sales
There is no change to our TGS investment case following its Q2 report, although we find reassurance in the strong cost control and continued profitability improvement within its Acquisition business. However, following two straight quarters where MultiClient late sales have failed to meet expectations, we believe this item needs to exceed investor expectations for interest to pick up in the stock. Thus, while we remain positive on the 12-month investment case due to its attractive valuation, we acknowledge that there are likely few catalysts ahead of its Q3 revenue update in early October. We reiterate our BUY and NOK200 target price.TGS Nopec Geophysical provides geoscience data to oil and gas exploration and production companies worldwide. In addition to global geophysical and geological data libraries that include seismic data, magnetic and gravity data, digital well logs, production data and directional surveys, Co. also provides advanced processing and imaging services, interpretation products, permanent reservoir monitoring and data integration solutions.
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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