Storage is full around the world. American gasoline usage fell off a cliff. American manufacturing utilization fell. It would be nice for SFL if they could get more product and chemical carriers. Better business than getting tied into Da Wolf's Sea Drill and perhaps repeating the FRO stealing again.
The fastest expansion in oil cargoes since 2004 is exceeding demand and filling up storage tanks from Egypt to Japan, creating a glut that threatens to reverse the biggest gain in shipping rates in five years.
Tankers will be carrying 488.8 million barrels by April 14, 3.9 percent more than the week earlier, estimates Oil Movements, which has tracked cargoes for 25 years. Rates for very large crude carriers, each holding 2 million barrels, will drop 58 percent to average $19,750 a day, the median of six analyst forecasts compiled by Bloomberg shows. Shares of Hamilton, Bermuda-based Frontline Ltd. (FRO), the largest operator, will fall 46 percent in 12 months, the average of 19 predictions shows.
Shipments accelerated as buyers sought to expand reserves on mounting concern that Middle East supply will be disrupted by conflict over Iran’s nuclear program. Rising stockpiles are coming at a time of slowing growth in China and a contraction in Europe, which together account for about 33 percent of demand. The global market is getting as much as 2 million barrels a day more than it needs, Saudi Arabian Oil Minister Ali al-Naimi said March 20.
“A ship owner would rather see strong consumer demand, and that we do not have,” said
SFL pretty much follows the market...when the market goes down or up, so goes SFL, though usually at a higher percentage...that's the main reason I hold no position here...I believe the market will go down more, and I don't want to hold stocks that will mirror or be a multiplyer of that result...sold my VLCCF today...bought more NLY....I have only Reits now....AAR, AGNC, NLY, CYS TWO.... some gold/silver....and two oil specs...TGC and MPET.
I was scared that I had made a poor decision to buy my shares in SFL Some times news or opinions get by us and we need to confirm our decision! SFL seems to have a range of $13 to $15 IMHO. My hottest holding is APPLE
madmax...I don't think that SFL is really showing any outstanding weakness at this time...First, the earnings per share are still strong...Second, SFL has a nice low P/E ratio...Third, they still are paying a nice dividend out of current earnings....
My opinion is, that the SFL share price is running a bit sideways at this time and following the current market trends...nothing has changed with shipping, actually things have been getting a bit better for the shipping industry...
That said, in my book, given the natural of their business and the forward outlook of their trade partners, SFL is still very under priced at this level...
This is could be answer # 11 (william is always correct). Keep the faith and keep investing...! $tagg...!