UPDATE: Deutsche Bank Downgrades Frontline; Lowers PT

According to a research report published this morning, Deutsche Bank has downgraded Frontline FRO from Hold to Sell, and lowered PT from $6 to $2. In the report, Deutsche Bank said, "Market concerns that FRO would be seriously weakened to the benefit of Frontline 2012 (FRTN.NWTC; NR, NOK24.00) after the December 2011 restructuring of FRO, appear to be confirmed. In Q1, FRO had to give up $15 million of earnings upside to its charterors (lessor of ships to FRO) as a cash sweep post-restructuring. Further, John Fredriksen, FRO's Chairman, has decided to sell his privately held sixteen crude and product tanker newbuilding order to Frontline 2012, while FRO's fleet continues to age. Given the lowerquality fleet, limited earnings upside and negative NAV we are downgrading FRO to SELL from Hold." Frontline closed yesterday at $5.44.