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Is Frontline Now In Calmer Seas?

Summary

Frontline has navigated out of its recent storms and may now be in calmer waters.

Money is rolling in thanks to record Middle East crude production.

The balance sheet is good, the dividend even better.

But... Can the company escape its stormy past and regain investor confidence?

Frontline Carrier

Frontline (NYSE:FRO) is one of the world's largest international transporters of crude oil. After the Doha meeting failed to freeze crude production Saudi Arabia, Iraq, and others will likely continue to produce huge quantities of the black stuff.

So, most likely, petroleum prices will stay low and global crude demand will continue to go up. And Frontline, along with other crude carriers, will profit by taking the stuff off site, either storing it in its huge ships or transporting it to the big global markets in the US, China, Japan, the EU and elsewhere.

Frontline owns and operates a fleet of 88 vessels, including VLCC (Very Large Crude Carriers), Suezmax (largest ship size capable of transiting the Suez Canal), LR2 (large long range clean petroleum product) tankers, and MR (medium range) tankers. Frontline is captained by John Fredriksen, the legendary Norwegian shipping magnate.

The company, however, has not had smooth sailing as of late. It recently went through severe financial storms and came close to bankruptcy last year. Perhaps it's no coincidence that the website has a large photo (see above) of one of its tankers resolutely plowing through tumultuous seas. Just looking at the site makes...


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