Tuesday, March 11, 2014

Seeking Alpha: A Rising Tide Of Sentiment Has Lifted Ship Finance

My decision to call Ship Finance (SFL) a Top Idea back on September 19, 2013 wasn't a particularly popular one, but the shares of this large marine vessel leasing company have risen almost 25% since then, while paying a healthy dividend along the way. I'll call that a short-term victory, particularly as Ship Finance has performed just as well or better than a lot of the vessel operators, including Nordic American Tankers (NAT), Costamare (CMRE), and Navios Maritime Partners (NMM).

There seems to be more optimism now about tanker and vessel rates than there has been in some time. Ship Finance has also managed to add vessels to its fleet, with attractive charters, while growing the drilling rig business. I am not as concerned about Ship Finance's ability to maintain its dividend payments, and apparently neither is management, as they recently increased the payout. The solid run in the shares has taken the easy money off the table, but they still hold some appeal for investors with a desire for above-average income and exposure to what may finally prove to be the long-awaited recovery in vessel rates.

Continue reading here:
A Rising Tide Of Sentiment Has Lifted Ship Finance

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