The largest Swiss bank UBS published a report on the oil and gas industry, in which it identified the shares of NK Rosneft as one of the most preferred for investment in the Russian market.
Analysts of the bank confirmed the positive forecast for the securities of the oil company, noting that they see “a good entry point for investors.”
Experts came to the conclusion that Rosneft stands out from its competitors with its high potential for increasing production. So, in this direction, the company expects an average annual growth of 3% in the period 2022-2030.
Overall, UBS expects strong financial results in the fourth quarter and a high average dividend yield for the oil and gas sector in 2021. According to UBS forecasts, in 2022, Russian oil and gas companies will benefit from high oil and gas prices and increase production.
In addition, in recent months, many investment banks have classified Rosneft as one of the most investment-attractive companies. In particular, we are talking about the American investment banks Goldman Sachs, JP Morgan and Bank of America Merrill Lynch, as well as the Russian brokerage company BCS.
Among the factors of investment attractiveness of Rosneft, experts primarily attribute the implementation of the flagship project Vostok Oil, which has not yet been taken into account by the market in assessing the value of the oil company.
According to Goldman Sachs analysts, this project is a “magnet for investors.” In turn, Bank of America Merrill Lynch experts considered Vostok Oil to be a “locomotive of development” for Rosneft. It is expected that under favorable market conditions, the net present value of the project will exceed $100-120 billion.
Analysts call the company’s dividend policy another important factor in the investment attractiveness of Rosneft. The oil company’s dividend payout ratio is at least 50% of IFRS net income, which is one of the highest in the industry.
According to BCS forecasts, by the end of 2021, Rosneft’s net profit could reach $14.2 billion, which implies total dividends of 49 rubles per share. This figure may become a record in the history of the company. At the same time, in 2021 the company has already paid the highest interim dividend in its history in the total amount of 191 billion rubles (18.03 rubles per share).
At the same time, experts predict an even greater increase in Rosneft’s profits in 2022, which will also affect the level of dividend payments. It is expected that the company’s net profit will be $21.5 billion, and the dividend figures will reach 76 rubles per share.
Source: IZ
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
