- GasLog (GLOG +4.7%) is initiated with an Overweight rating and a $26 price target while gas shipping peer Golar LNG Partners (GMLP -3.6%) is downgraded to Equal Weight with a $33 target at Morgan Stanley.
- GLOG offers relatively low downside, having most of its fleet locked in solid long-term charters with strong counterparties and a reputation as a top quality operator, the firm says; GLOG's ability to identify attractive acquisition opportunities, not only by ordering newbuilds but also secondhand vessels, suggests stable growth potential.
- The firm sees lower upside for GMLP due to the anticipated difficulty of its parent, Golar LNG (GLNG +1%), to secure long-term contracts for its newbuilds during the next 12 months; however, even with the $33 price target, GMLP still offers 10%-15% total return including a 6.7% yield.