Western Bulk Chartering (Buy, TP: NOK25.00) - Encouraging signs needed
Q3 marked the company’s seventh consecutive quarter with no dividends, and reflected soft recent performance given its policy of paying out 80% of net profits. However, our reduced normalised TC margin implies a 2025 dividend yield of ~16%, with upside potential to margins converging towards 2020–2022 levels. Also, the share price has fallen ~20% since the Q3 update, removing much of the downside risk, in our view. We reiterate our BUY, but have cut our target price to NOK25 (32).
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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