TGS (Hold, TP: NOK105.00) - Not enough fish in the sea
Our view on TGS is underpinned by increased structural, political and commercial threats exemplified by the soft top line development in 2023 and Q4, potentially limiting seismic demand growth. The upside potential to FCF generation remains higher late sales or increasing dayrates, both of which we struggle to see unfolding given the fundamental challenges. We reiterate our HOLD and have cut our target price to NOK105 (150) on lowered estimates.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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