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KNOT Offshore Partners (NYSE:KNOP) +12.7% to its highest in nearly two months in Tuesday’s trading after Alliance Global Partners upgraded the stock to Buy from Neutral with an $8 price target, following “solid” Q1 results and progress in closing charter windows on several shuttle tankers.
“With firmer Q1 2023 operating results, refinancings lined up, open charter windows closed in 2023 and start-up of longer time charters over the next nine months, we have more conviction in the near-term and intermediate outlook,” Alliance Global’s C.K. Poe Fratt said.
KNOT Offshore’s (KNOP) Q1 operating results came in above expectations due to higher revenues and lower operating costs, according to the analyst.
Despite some charter gaps over the next nine months that need to be addressed, Fratt believes KNOT Offshore’s (KNOP) risk/reward profile has shifted and become favorable, while recent stock price performance has been weak, and remaining challenges including elevated financial leverage are adequately discounted.
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