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5-Star Stocks Poised to Pop: Seaspan

Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, containership operator Seaspan (NYSE: SSW  ) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Seaspan's business and see what CAPS investors are saying about the stock right now.

Seaspan facts

Headquarters (Founded) Majuro, Marshall Islands (2005)
Market Cap $1.02 billion
Industry Shipping
Trailing-12-Month Revenue $447.8 million
Management

CEO Gerry Wang (since 2005)

CFO Sai Chu (since 2007)

Return on Equity (Average, Past 3 Years) (2.8%)
Cash/Debt $212.3 million / $2.8 billion
Dividend Yield 5.0%

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 96% of the 803 members who have rated Seaspan believe the stock will outperform the S&P 500 going forward. These bulls include All-Star eksummers620 and saxonglass, both of whom are ranked in the top 15% of our community.

Just last week, eksummers620 tapped Seaspan as a timely bargain opportunity: "With management motivated to raise the dividend and its aggressive ship-building program, the recent price decline is attracting my attention."

Over the next five years, in fact, Seaspan is expected to grow its bottom line at a brisk rate of more than 22% annually. That's faster than other shipping stocks like DryShips (Nasdaq: DRYS  ) (10%), Navios Maritime Partners (NYSE: NMM  ) (3%), and Overseas Shipholding (NYSE: OSG  ) (1%).

CAPS member saxonglass elaborates on the Seaspan bull case:

[E]essentially all ships are on long term contracts. Less volatility and less credit risk for the company. Long term growth of "dry" shipping is potentially enormous with China, India, etc. requiring raw materials and shipping finished products. Dividend will likely increase year by year for the next couple of years with a potential of over 1.00 per share payments in 1-2 years.

What do you think about Seaspan, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!  

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended writing a covered straddle position in Seaspan, and The Fool owns shares of it. 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 Fool's disclosure policy always gets a perfect score.


Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 20, 2011, at 10:13 AM, gcmagone wrote:

    I am retired so I buy the shippers for income. Navios Maritime (NMM) with a 9+% yield certainly beats the 5% SSW pays.

  • Report this Comment On June 20, 2011, at 1:10 PM, 2forward1back wrote:

    22% per year for 5 years.. That's a lifetime in this crazy market... Buy & Hold is strategy is dead

    DRYS will double before this year ends.

    Long DRYS.. :)

  • Report this Comment On July 04, 2011, at 7:54 AM, thity2hop wrote:

    SSW has emerged from the financial meltdown with a stronger more predictable earnings model. They enter into orders for new ships once they have a long-term customer signed up. Typically they arrange long-term 12 year fixed rate contracts. Shipper, not SSW takes on risk of higher fuel prices. SSW locks in financing and certainty of cash flow. They intend to distribute 20-25% of available cash flow thru dividends with remainder powering groth of income producing fleet. So while the enterprise value climbs, you get 5% cash distributions. The dividend plus increase in company value is far greater than 9%.

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DocumentId: 1509317, ~/Articles/ArticleHandler.aspx, 5/27/2012 11:55:57 PM

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Related Tickers

5/25/2012 4:01 PM
SSW $16.59 Up +0.14 +0.85%
Seaspan Corp CAPS Rating: *****
OSG $11.75 Up +1.04 +9.71%
Overseas Shipholdi… CAPS Rating: **
NMM $13.91 Up +0.82 +6.26%
Navios Maritime Pa… CAPS Rating: *****
DRYS $2.29 Up +0.04 +1.78%
DryShips, Inc. CAPS Rating: ***

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