Tuesday, April 24, 2012
STX OSV: DnB Nor expect bidding to close soon and maintains Buy with $2.00 TP. Note that with rev assured by a large order book, margins are an important share price driver. Expect EBITDA margins to normalise to 15% in 2012 (19% in 2011). Still believe that a tighter OSV and subsea market will raise vessel owners’ confidence in placing new orders, in anticipation of a stronger market. House reiterate belief that STX OSV is well positioned for such orders, as supported by recent order flow. As STX OSV is filling up its 2013 yard slots, believe it is not desperate for orders and can be selective in orders that offer the most economic benefits. Add that for the past couple of mths it has been widely known in the mkt that STX OSV’s Korean parent, STX Corp, is looking to divest its 51% stake, which would necessitate a general offer. House expect some firm bids from interested buyers and the closure soon.