Overseas Shipholding Group Shares Plunged: What You Need to Know


Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of tanker company Overseas Shipholding Group (NYS: OSG) fell 12% today after the company released a mixed earnings report.

So what: Second-quarter adjusted net loss per share of $1.20 was actually better than the $1.43 loss analysts were expecting. The loss is the ninth straight quarterly loss and caused the company to cut its dividend payout to a $0.875 rate annually.

Now what: An oversupply of tankers in the industry with more being built annually has put companies like Overseas Shipholding in a tough position. It can operate ships at a loss for each voyage or write them off completely, taking a massive loss in the process. Right now there's no end in sight to the losses, and the company's dividend is also taking a big hit. I see no reason to jump into shares today.

Interested in more info on Overseas Shipholding Group? Add it to your watchlist.

At the time thisarticle was published Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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