Is now a good time to be tucking away a few shares in the shipping services group Braemar?
Braemar is a brokerage/chartering, investment advisory and securities business focused on maritime sectors.
It has customer contracts that run through to 2039.
The company offers broking services across a range of segments including tankers, specialised tankers/products (like gas, liquefied natural gas), dry cargo and offshore.
It also offers Sale & Purchase advisory, investment banking, and corporate finance services and offers Securities services to the shipping sector globally.
Its main markets comprise the UK, Singapore, the United States, Australia, Germany and the rest of the World.
Late last week, its shares were hit quite smartly on rumours of the group’s involvement of brokering-off tankers for use in freighting Russian oil on a global basis.
They eased 16.5p to close on Friday night at just 261p, on the back of 185,540 shares dealt, compared to the average daily volume of 68,652 being traded.
At this level the whole international group is only valued at £79.7m, which analysts believe will be reporting current year, to end February 2025, adjusted pre-tax profits of £15.8m (£16.1m), worth 32.3p (34.2p) per share in earnings, while paying 13.2p (13.0p) in dividends.
Analyst Damian Brewer at Canaccord Genuity Capital Markets has a Buy note out on the group’s shares, with a 410p Price Objective.
While, Ian McInally, at Cavendish Capital Markets, has a 392p Price Aim on the shares.
My View
If they stay this cheaply-rated for too long, I have a strong feeling that any one of the other players in the international marine services sector will look to take it over.
A number of canny players are already in the equity with declared positions.
We are just a month away from the group reporting its Interim Results for the six months to end-August.
For the time being, I stand by my early May price prediction.
(Profile 05.12.19 @ 185p set a Target Price of 250p*)
(Profile 20.05.20 @ 99p set a Target Price of 150p*)
(Profile 07.05.24 @ 277p set a Target Price of 350p)
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