Suggestion by Tim Plaehn on 2008-01-07 16:45:55
I am a big fan of oil tanker stocks so wanted to point out a few areas this article could be clarified. Oil tankers are leased our either on time charters or the spot market. FRO leases primarily to spot market customers. A description and pros and cons of the two types of leasing would be informative to the prospective investor. Also, where the competitors lease their ships, time charter or spot. Next, FRO started selling of Ship Finance (SFL) in 2004 and currently owns less than 1% of the company. FRO however does lease many of their vessels from SFL on long term contracts. Finally, no discussion of tanker stocks, especially FRO, is complete without mentioning (in depth!) their dividend policy. Several tanker companies, including FRO, pay out the majority of their profits as dividends. The dividends tend to be a large percentage of the stock's return and can fluctuate significantly along with the spot tanker market.
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