Commissioned Research: DOF

Commissioned Research

Article by: Nordea Markets

We believe DOF is well-positioned to take advantage of the upturn in the subsea market.

DOF has commissioned Nordea Markets to produce a research report with the aim of providing investors with quality research on the company.

Geared exposure to subsea recovery – Updated 11 April 2018

Global provider of offshore and subsea services

DOF is a global provider of offshore and subsea services to the offshore oil and gas industry through its fleet of 67 offshore service vessels. DOF’s AHTS/PSV fleet is relatively young and consists mainly of high-end vessels, which makes it well-positioned in the market, while its subsea fleet of pipelay-, construction- and dive-support vessels enables DOF to serve most of the subsea value chain.

Exposure to subsea recovery

We are now seeing an emerging upturn in the subsea market as several years of underinvestment draw to an end and field developments keep on hitting the market, prompted by reduced field breakevens and improved financials for oil companies. We believe DOF is well-positioned to take advantage of the upturn thanks to its mix of subsea project capability and time chartering of subsea vessels.

Valuation 

Based on our sum-of-the-parts and multiple valuation, we value DOF at NOK 0.95 -1.38 per share. The low end of the range is based on our fundamental sum-of-the-parts approach, grounded on DCF valuations of each subsidiary, while the high-end is based on the historical average sector multiple pre-downturn and DOF’s own median multiple of 8x.

Read the full report

Nordea Markets is the commercial name for Nordea’s international capital markets operation. The information provided herein is intended for background information only and for the sole use of the intended recipient. The views and other information provided herein are the current views of Nordea Markets as of the date of this document and are subject to change without notice. This notice is not an exhaustive description of the described product or the risks related to it, and it should not be relied on as such, nor is it a substitute for the judgement of the recipient. The information provided herein is not intended to constitute and does not constitute investment advice nor is the information intended as an offer or solicitation for the purchase or sale of any financial instrument. The information contained herein has no regard to the specific investment objectives, the financial situation or particular needs of any particular recipient. Relevant and specific professional advice should always be obtained before making any investment or credit decision. The document has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination.
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Conflict of interest

Readers of this document should note that Nordea Markets has received remuneration from the company mentioned in this document for the production of the marketing material. The remuneration is predetermined and is not dependent on the content. It is important to note that past performance is not indicative of future results. Nordea Markets is not and does not purport to be an adviser as to legal, taxation, accounting or regulatory matters in any jurisdiction. This document may not be reproduced, distributed or published for any purpose without the prior written consent from Nordea Markets.

Issuer review

This report has been reviewed, for the purpose of verification of fact or sequence of facts, by the issuer of the relevant financial instruments mentioned in the report prior to publication. The review has led to changes of facts in the report. Completion date: 11 April 2018, 06:50 CET

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