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Seaspan Corporation Message Board

  • patroutman patroutman Aug 3, 2007 2:17 PM Flag

    Morning Star Article - Don't get it

    So how are we going to suffer if we already have 10-12 year locked in charters?
    If the likes of the china shipping etc want fixed rates then sell us your boats, and charter them back from us.
    This is all good for SSW.
    Can someone please point out the negatives in the article?

    How is the party over. With SSW's vision, I'd say were still getting started.

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    • Today they put SSW on their buy list.

    • jdfunnell Aug 8, 2007 1:53 AM Flag

      Aw, come on, Steve, you've got a 20% down payment for a $150 million ship in your hip pocket, just like I do and all the other SSW fans. Just 'fess up.

      There's a level on which I think Morningstar was right, and a level on which I think they were wrong.

      They were right on:

      1) Low barrier of entry, assuming you've got the bucks. You order a ship or buy a used ship. Long term expertise is not a requirement to sit down at the table. But it is a requirement to walk away from the table a winner. Barrier to entry is largely about technology, but here you can buy it.

      2) Supply will ultimately outstrip demand. That's the history of virtually everything that soars in price and takes a long time to come to market.

      Where they were wrong:

      1) Not enough elucidation that the SSW model is the only way to smooth out the waves, be they financial or ocean.

      We're with you and, in fact, SSW is the single largest investment we have ever made. Because it is the single best opportunity we have ever seen.................Dave

    • If the market is getting ready to dive a bit, it's good to stay put in a good company like this. The future is looking good with this one.

    • jdfunnell Aug 7, 2007 1:37 AM Flag

      Spot on. Morningstar was trying to call a top in Day Rates. That's why we're in this stock and not the others. For over a year, I've been trying to find a better business model to diversify our holdings in this space and have yet to find one.........Dave

    • 1- see my prev thoughts- new info
      2. 08/10/2007- 1.8 mil short options expire- ouch for them
      3. This stock is owned in Hong Kong bu instituitions
      3. This is an investment for me at at a long term locked in growth, nice div/yield, and alot of free flow cash.
      4. I work in this industry(not the company) and know what
      the future holds for global shipping(not petro tanker though
      5. These sellers are HELPING ME
      ya'll make up your own minds I know the transport players in my industry- rail, truck, air, water- This is a good one

    • I guess you didnt get the word. There is a global recession and all are going out of business. No trade=no money. We're all meeting over at Hooters one last time. (This is a bear attack article, which there are plenty. Its just a game they play to make money. But longs will get the last laugh.)

    • Low barrier to entry? Really? Is Morningstar saying it is easy to get a ship built, contracted and launched? And that with more ships coming on line the cost of shipping will remain flat or go down in several years? I don't agree with all those assumptions. Did anyone read the interview in Barron's, 08/06/2007, with David Richards? Global economy will continue to grow at 4-6%/ year and large companies are the way to bet. Who is going to ship all those goods? Seaspan for one!

    • Right, it really wouldn't hurt Seaspan at all. Once they lease a ship (the leases normally being 6-9 year contracts), they get paid on the lease no matter where the ship is or what the ship is doing and is heavily insured just in case the ship is sinking. If the ship is on time and making strong progress to ports, SSW gets paid on the lease. If the ship is stuck in port due to yet another longshoreman union strike over modernization in California, SSW gets paid on the lease. If the ship sinks in a massive typhoon, SSW gets paid on the lease and the insurance settlement.

      Leave it to an accountant to come up with a cashcow called Seaspan. Milk that mother!

    • Good to hear your support. To make sure I clearly understand it would have no impact on SSW whatsoever if vessels were delayed in port? Actually, it might help SSW since a back-up, like the one in Australia- would keep a queu of ships waiting in harbor therefore cutting capacity to some degree, right?

      I'm invested in dry-bulks now and have some ESEA which also has a few container ships. Are you familiar with them?

    • Yeah, some read the Morningstar headline (only because Yahoo had it listed with SSW) and assumed the worst. And if they actually 'read' it, I'm guessing the reading was more of a quicky scan to see if SSW was actually mentioned. Which it the OWNER of cargo ships with long term leases.

      'With These Stocks, It's Time to Abandon Ship.' What a headline and with SSW lumped in there I can see how a jittery investor/trader could assume the worst.

      To mitigate the effect of such a volatile market, the largest container shipping companies, such as A.P. Moeller-Maersk and China Shipping, have chartered-in an increasing amount of outside-owned vessels over the past several cycles. The ship owners--such as Seaspan (NYSE:SSW - News) or Danaos (NYSE:DAC - News)--will typically agree to a rate that is less than the current spot rate, but over a very long period of time (sometimes 10 to 12 years!). By doing so, the shipping companies can lower their fixed costs while the ship owners avoid violent price movements over many market cycles.

      So good news for Seaspan, bad news for tankers.

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