Sakset fra DNB
DHT HOLDINGS The bar has been set DHT Holdings is set to report its Q4 results before market open on Tuesday 6 February. We believe the company will beat consensus estimates on earnings, aiming to match Euronav’s strong Q4 operating performance. We are 6% above consensus on adjusted EBITDA, and believe DPS of USD0.02/share will be maintained despite the market headwinds this winter. We reiterate HOLD with a USD4.00 target price.
Revisions from fleet changes and lowered rate expectations. We have made minor adjustments to our Q4 2017 rate forecasts, and updated for November vessel sales affecting the company’s earnings potential for 2018–2019e. Entering 2018 with disappointing VLCC spot rate levels has prompted us to lower our expectations for Q1 2018 as well, reflected in our full-year 2018 estimate changes.
We are above consensus on earnings, 6% above on EBITDA. We are above Q4e revenue consensus for DHT, as we believe the company will post results well above quoted market rates for the quarter after Euronav recently reported solid spot rate performance of USD25.9k/day for Q4. Hence, we are 6% above Bloomberg consensus on adjusted EBITDA. We believe DHT will declare its 32nd consecutive quarterly dividend at USD0.02/share, broadly in line with consensus.
Light at the end of the tunnel, but is it dark enough yet? The tanker market has been through two quarters of historically low earnings for VLCCs, with the worst Q3 since 2013 and the worst Q4 since 2012, amidst excessive fleet growth and tight exports from the Middle East. We continue to believe sustained high levels of scrapping is necessary for tankers to reach an inflection point.
We reiterate our HOLD recommendation and target price of USD4.00, based on 0.85x our 1-year forward NAV/share of USD4.80 (slightly up from USD4.70), with flat asset values one year ahead. We calculate a current NAV of USD4.90/share (USD4.70), and if asset values were to decline by 5%, we estimate the 1-year forward NAV would be USD4.30/share (previously USD4.20/share). We calculate market-adjusted leverage of 58%, and believe a 10% change in asset values would mean a 23% (or USD1.14/ share) change in the NAV.
HOLD