UPDATE: ABG Sundal Collier Upgrades Golar LNG to Buy on Drop-Downs Valuation

ABG Sundal Collier raises its rating on Golar LNG

from Hold to Buy and raises its price target from $40 to $45. ABG Sundal Collier says, "The company is optimistic about future prospects, thus it has raised dividends and has declared a share buy-back program to support this view. We agree and upgrade Golar LNG to BUY (Hold) with a new target price of USD 45 (40) as 1) drop-downs to Golar LNG Partners (GMLP, USD 31.90, not rated) add value – and we expect the equity market to discount additional drop-downs into valuation once the next drop-down to the GMLP is completed, 2) there are plenty of near-term share price catalysts from drop-downs, upcoming vessel fixtures and potential FSRU contract awards, 3) a 6% dividend yield in 2013e coupled with a share buy-back program provides downside support and 4) our EBITDA forecasts are +7%/ 9% above consensus for 2012e/2013e." GLNG closed at $34.05 on Wednesday.