Adjusted for Lerøy shares, Austevoll Seafood has a negative value

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Fish meal production and pelagic fishing doesn’t appeal to investors on the Oslo Stock Exchange.

DNB Markets has upgraded the recommendation for Austevoll Seafood to Buy from Hold, repeating the NOK 101 price target, according to an update Tuesday, TDN Finance reports.

Austevoll Seafood is traded at NOK 86.25 per share on Wednesday morning.

Austevoll Seafood, controlled by the Møgster family, owns 52.6 per cent of the outstanding shares in the world’s second largest salmon farmer, Lerøy Seafood Group. The 313.9 million shares currently have a market value of EUR 1.7 billion.

“Excluding the position in Lerøy Seafood, Austevoll Seafood is trading at a negative value of NOK 630 million (EUR 64 million) against its historical average of NOK 1,350 million (EUR 138 million) This implies two billion or ten kroner per share upside to the typical valuation,” wrote DNB Markets analyst Alexander Aukner.

The investment bank believes there are few structural reasons why the stock should be traded for what is the second largest discount in the last ten years.