HOEGF - Hoegh Autoliners: Don't Be Fooled By Q1 Dividend Reduction Value Still There
2024-04-22 09:25:12 ET
Summary
- Höegh Autoliners improves dividend policy to 100% FCF, distributing over 70% of market capitalization in the next two years.
- PCTC market experiencing tightness with strong demand expected in the coming years, particularly in Asian car exports.
- Höegh Autoliners maintains strong financial position, with potential for attractive dividend yields and a fair value of $14.
Investment Thesis
The car carriers segment is facing a capacity deficit similar to containers during the covid boom. However, unlike containers, the demand in this sector appears promising in the longer term, with a substantial order book expected to be seamlessly absorbed. Seizing these favorable conditions, Höegh Autoliners has improved their dividend policy to 100% FCF, enabling the distribution of over 70% of their market capitalization within the next two years.
Business Overview
Höegh Autoliners ASA is a prominent provider of ocean transportation services within the Roll-on Roll-off (RoRo) segment such as cars, high and heavy machinery and breakbulk. As of now, the company operates fleet of 35 Pure Car and Truck Carrier ((PCTC)) vessels, with 12 newbuilds ordered....
Hoegh Autoliners: Don't Be Fooled By Q1 Dividend Reduction, Value Still There