June 3, 2011 7:03 AM EDT Wells Fargo downgraded Frontline Ltd. (NYSE: FRO) from Outperform to Market Perform.
Wells analyst says, "We are downgrading shares of FRO on the back of prolonged tanker weakness and management's inclination to position FRO for a multi-year tanker trough. While we continue to believe we are trending along the bottom of the tanker market with the potential for a 2012 recovery, we believe better entry points into FRO may emerge, as the company looks to shed capacity and take a more defensive stance. We believe names such as Teekay (NYSE: TK) and Overseas Shipholding (NYSE: OSG), which are trading in closer proximity to their respective NAVs, represent better value at this point in the cycle."
jd.... thanks for the link, I have been negative on FRO for some time as most of their fleet, if not all, is VLCC, which is suffering the most from the glut of tankers, as well as a very high debt load. Cramer gave the kiss of death to the entire tanker sector last night with the exception of NAT, which he continues to bolster even as only a neutral. . Best to all, comments and discussion encouraged. \