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Some of you may have seen my posts on IMO2020, the critical environmental legislation that limits sulphur content of marine fuel. Euronav $EURN is a critical piece of the supply chain that makes this happen. They own large ships that transport oil.

EURN closed Friday at $10.96. By my calculation the liquidation value of the company looks something like this:

Assets - Cash on hand ~$335M (ended Q3 with $185M but cash flow Q4 will be ~$300M) - Fuel inventories (part of brilliant IMO2020 strategy) $220M - Vessel values $3.2B - Other $200M

Liabilities - Debt $1.3B - Other liabilities $660M To save on European taxes they have accelerated depreciation schedule of

Difference: 1.78B (3200+200+335-1300-660=1775) 215 M shares 1775/215=8.25

Liquidation value: $8.25/share

Current share price assumes next 13 years of cash flow worth only $2.71/share! FCF unaccounted for above between now and end of Q1 should be ~$2.60/share. Eurn will have according to my calculation on their 60% dividend payout policy change and quarterly dividends due to belgian law update forward yield of 23% in February.

So what do you think it's worth?



Submitted November 24, 2019 at 06:11PM by calvinfroedge https://ift.tt/2QIUoMJ

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