Odfjell earns a thin-but-positive economic profit at mid-cycle (adj ROIC 8.6% vs 8% WACC), so the equity is a leveraged bet on chemical-tanker rates rather than a structural compounder.
Today's EV/IC of 0.78 and ~13% FCF yield pay you to hold through a soft patch, but the tonne-mile tailwind from Hormuz disruption is the swing factor — it can flip 2026 from down-year to up-year.
Reverse-DCF: capitalizing adj NOPAT NOK 1,618m at WACC-g (8% - 1%) = ~NOK 23.1bn EV; less net debt incl leases ~NOK 9.0bn = ~NOK 14.1bn equity ≈ NOK 178/sh — but this assumes mid-cycle NOPAT persists, which is generous for a cyclical.
On a normalized (down-cycle haircut ~15% to NOPAT) base the bridge lands near the current NOK 111; the market is already discounting rate normalization, so margin of safety is modest.
The market pays today’s enterprise value for roughly -28.4% NOPAT growth over 5 years. The business earns 9% on capital against a 8% cost of capital (spread +0.6 pp); the no-growth value is NOK 190/share (171% of price), so the rest is priced-in growth.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | NOK 165 | -10% | +49% | 30% | Hormuz disruption persists, tonne-miles elevated; ROIC back to 11-12%, EP doubles |
| Base | NOK 120 | -25% | +8% | 45% | Rates normalize off 2025 highs; terminals + new tonnage hold margin; ROIC ~8-9% |
| Bear | NOK 80 | -39% | -28% | 25% | Rate down-cycle + newbuilds into weak market; ROIC below WACC, dividend trimmed |
| Prob-weighted | NOK 124 | — | +11% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 6.50% | 281 | 299 | 311 | 330 | 342 | 372 |
| 7.25% | 228 | 239 | 246 | 255 | 261 | 272 |
| 8.00% (base) | 190 | 196 | 198 | 201 | 203 | 201 |
| 8.75% | 161 | 163 | 163 | 161 | 159 | 148 |
| 9.50% | 138 | 137 | 134 | 129 | 124 | 107 |
Green = fair value above the current price of NOK 111.00. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.
TCE/day proxy USD 27,232; every USD 1,000/day ~ USD 70-90m revenue — Hormuz tonne-mile surge firmed March spot.
Renewed ~1/5 of portfolio at slightly lower average rates in Q1 — rate roll-down is the structural headwind into 2026.
USD 290m Kitanihon order + 19-vessel orderbook; DWT +10-20% by 2029 — growth capex at a cyclical top is the capital-allocation risk.
Q1 net USD 2.3m, occupancy 94%; stable annuity that diversifies away from pure spot-rate exposure.
USD 99.7m FY25, USD 39.6m in Q1.26; ~13% FCF yield — sustainable only if rates hold.
A well-run, candidly-reported cyclical that is cheap on assets and FCF but only a marginal economic-value creator at mid-cycle — the thesis lives or dies on chemical-tanker rates, not on a widening moat. HOLD, medium conviction; base target NOK 120.
Buy the dips below NOK 95 (clear discount to normalized value) and trim into rate-driven spikes; the Hormuz tonne-mile setup is the near-term upside catalyst worth watching.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Source reports archived locally.
NOPAT adjustments: asset_disposal_normalize removes the LTM capital gain on vessel/barge disposals (USD 5.9m = FY 3.3 - Q1.25 2.2 + Q1.26 4.8; NOK 58.3) which sits inside reported EBIT. This is a non-operating one-off; mttssn normalizes it OUT of NOPAT. No other pretax adjustments: no capitalized R&D, no PPA amortization, no restructuring, pension immaterial. IFRS 16 lease interest already below EBIT — no add-back.
Post-tax add-backs: FY25 impairment was only USD 0.3m (NOK ~3m) — immaterial, not added back.
Company add-backs we reject: No PPA amortization (no acquired intangibles / no goodwill on BS). No IFRS 2 SBC expense — only minor sales of treasury shares to employees (NOK ~1.3m/qtr), not an expensed comp charge.
Invested capital: BS snapshot 31.03.26 (USD, converted at FX 9.885). lease_liabilities_in_ic=TRUE: Odfjell operates a deep-sea chemical-tanker fleet of which time-chartered / bareboat vessels (ROU assets USD 285.7m, lease liab USD 298.5m) are CORE operating assets, not peripheral. IC = equity_ex_oci 9651.7 + IB debt 7391.0 (mortgages+SLB+bonds, ex ROU) + lease_liab 2950.7 - excess_cash 1079.4 = 18914.0. NCI = 0 (net result 100% to parent per comprehensive-income note).
Pages read — FY: [2, 3, 4, 5, 8, 9, 10, 11, 15, 16, 17, 18] · Q: [1, 2, 3, 4, 5, 8, 10, 11, 17, 18]
How the mttssn view has evolved — each prior dated note is preserved.