Deutsche Bank Starts Navigator Holdings Ltd. (NVGS) at Buy, PT $24

Deutsche Bank analyst Chris Robertson initiates coverage on Navigator Holdings Ltd. (NYSE: NVGS) with a Buy rating and a price target of $24.00.

The analyst comments "We are initiating on NVGS with a Buy rating and a 12-month price target of $24/sh (45% upside from recent closing price) based on shares trading at 85% of our NAV/sh estimate. We have derived our estimates using fair market values of the carrier assets and by using a 10x EBITDA multiple on Navigator's portion of the ethylene export terminal's estimated run-rate EBITDA. Navigator Holdings (also often called "Navigator Gas") specializes in the seaborne transportation of liquefied petroleum gases, ammonia, ethylene, and ethane. The Company owns and operates a fleet of 57 on-the-water vessels, which consists of semi-refrigerated, fully-refrigerated, and ethylene-capable gas carriers. The Company leases out its ships on fixed time period or spot/voyage based charters. In shipping, a "time charter equivalent rate" is a way to express the daily revenue earned by a ship as if it were on a time charter, which is expressed on a dollar-per-day basis. In addition to the operation of its fleet, the Company generates income from the terminal operations and export of ethylene from the Morgan's Point ethylene export terminal, a 50-50 joint venture between Navigator and Enterprise Products Partners (EPD). We believe the LPG carrier market will be supported by increased demand for the transportation of LPG commodities and products, especially related to start-ups and expansions of LPG export terminals in the US Gulf Coast and from increased exports from the Middle East. This dynamic should be supportive of robust and less-volatile LPG carrier rates. We believe this will afford Navigator the opportunity to steadily increase its quarterly cash dividend, pursue opportunistic share repurchases, and continue to invest in its fleet."

For an analyst ratings summary and ratings history on Navigator Holdings Ltd. click here. For more ratings news on Navigator Holdings Ltd. click here.

Shares of Navigator Holdings Ltd. closed at $16.39 yesterday.

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