Norway's Stolt-Nielsen shares rose sharply on Thursday after several brokers lifted the target price.
The stock gained as much as 7.3% to NOK 462.50 ($43) in Oslo.
DNB raised the target price to NOK 555 from NOK 500.
The Norwegian bank sees “solid earnings yield potential”.
“We believe the strong Q2 TCE earnings guidance will set a new ’normal’ for tankers, with a low orderbook coupled with strong MR rates and Canal disruption fuelling the strong chemical rates c65% above the five-year average YTD,” analyst Jorgen Lian said in a note.
DNB has raised the rate estimate for tankers to reflect the 6% to 8% positive time charter equivalent guidance for the second quarter, which Stolt-Nielsen gave yesterday in connection with first-quarter earnings.
The bank said “the strong momentum should be extended”.
Lian kept a buy recommendation for the shipowner.
“Hence, we believe the lower COA share provides attractive spot exposure and renewal opportunities. Thus, we calculate a NOK 76 EPS over the next four quarters, or an 18% earnings yield,” he said.
Fearnley Securities hiked the target price to NOK 515 from NOK 500.
The broker also sees the strong trend for tankers continue.
Analyst Oystein Vaagen expects “earnings in the entire group to improve as the terminal and container divisions will also give support”.
“Steady and improving earnings base is deserving of higher multiples,” he said.
Stolt-Nielsen “remains an attractive investment for a growing liquids logistics provider”, according to Vaagen.
Clarksons Securities raised the target price to NOK 500 from NOK 450.
“Stolt-Nielsen’s stock performance has continued to be strong but remains supported by a compelling valuation,” analyst Frode Morkedal said.
“Given the attractive multiples, we believe there is further potential for stock price appreciation,” he added.
