Nordic American Tanker Shipping, Ltd. owns and operates crude oil tankers. The company operates its vessels in the spot market, on time charters, or on bareboat charters. As of December 31, 2007, it owned 12 double hull Suezmax tankers averaging approximately 155,000 deadweight tons each. The company was founded in 1995 and is headquartered in Hamilton, Bermuda.
Nordic American Tanker is not a dividend achiever but a component of the NYSE Composite and Zacks Yield Hog index. From the end of 1999 up until September 2008 this dividend stock has delivered an annual average total return of 29.10 % to its shareholders. The stock gained 19 % value so far in 2008.
The ROE has fluctuated greatly; rising from 4% in late 1990’s to over 38% in 2004 before falling to 7% at the end of our study period.
41.2% of the 2007 dividends were distributed from current earnings while 58.8% were a return of capital.
One positive is that the company has low amounts of long term debt relative to its assets. I also liked the fact that the tangible book value of the stock was at $22.42 at the end of 2007.
One positive is that Nordic American Tanker has never paid a quarterly dividend per share which was lower than 30 cents/share. If I were a holder of NAT I would treat any quarterly payment as if it were only 30 cents and putting the rest in a savings account in order to smooth my dividend income.
Disclosure: I do not own shares of NAT