Cautiously Looking To Shipping Sector

Very , very  cautious. Just because it is hard hit – does not mean it has hit bottom.

Having said that : Jack A. Bass Managed Accounts bought a few shares in Teekay at $ 3.58 this morning.

TEEKAY TANKERS LTD(TNK:NYSE, US)

3.60USDIncrease0.10(2.86%)Volume: 
Below Average
As of 05 Jun 2014 at 12:22 PM EDT.

QUOTE DETAILS

Open 3.49 P/E Ratio (TTM) 14.5x
Last Bid/Size 3.59 / 31 EPS (TTM) 0.24
Last Ask/Size 3.60 / 1 Next Earnings 4 Aug 2014
Previous Close 3.50 Beta 2.10
Volume 194,420 Quarterly Dividend 0.0300
Average Volume 511,414 Dividend Yield 3.33%
Day High 3.60 Ex-Dividend Date 15 Apr 2014
Day Low 3.43 Shares Outstanding 83.7M
52 Week High 5.08 # of Floating Shares 62.75428M
52 Week Low 2.49 Short Interest as % of Float 12.80%
chart
Nordic American Tankers (NYSE: NAT  ) announced this week that it agreed to acquire two Suezmax vessels for $36.6 million apiece. The ships, which were built in 2005, will expand Nordic American Tankers’ fleet to 22 Suezmaz ships. It’s a move that should also fuel future dividend increases at a company that already yields more than 11%.Sticking with what works Nordic American Tankers noted that these ships are essentially sister ships to the rest of its fleet, as the company’s business model is built around only owning Suezmax ships. The company notes this is of significant importance, as it provides both operational and cost synergies that enable the company to earn more money, which it, in turn, sends back to investors in the form of a very hefty dividend.This is a bit of a different approach than competitors like Frontline (NYSE: FRO  )  which has a bit more of a diversified fleet consisting of 17 Suezmax vessels and 29 Very Large Crude Carriers, or VLCCs — and Teekay Tankers (NYSE: TNK  ) , which is also diversified, as it owns a fleet of Aframax tankers, Suezmax tankers, product tankers, and one VLCC. For Nordic American Tankers, its focus on simplicity is what it’s using to fuel its extra-large dividend to investors.
The overall improvements in the tanker market was also apparent last quarter at Teekay Tankers, as it had a solid first quarter. Teekay Tankers reversed its year-ago loss, and declared its fixed-quarterly dividend of $0.03 per share. That fixed divided, while much lower, is a nice anchor in for investors, though its payout has also fluctuated wildly during the past few years. Frontline, on the other hand, hasn’t yet experienced the turn in the market, as the company turned in another net loss on the quarter, which is why it didn’t declare a dividend for the quarter.

 

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