What happened

Shares of container shipper Seaspan Corporation (NYSE:SSW) sank 13.4% in March, according to S&P Global Market Intelligence.

So what

That's actually not too surprising, considering the news that landed right before the month started. On Feb. 28, Seaspan reported its financial results for fiscal 2016 -- and dropped a bombshell.

Not only did Seaspan report a $1.89-per-share loss for the year (on $877.9 million in revenue), but in an attempt to stem the bleeding, it also announced "the difficult decision to reduce the quarterly dividend on our common shares to $0.125 per share." From the previous level of $0.375 per share, that represents a 67% cut to Seaspan's dividend.

Oil painting of a ship in a storm.

Seaspan tossed dividend investors overboard last month. Image source: Getty Images.

Now what

Management explained the cut as a move to conserve resources that will enable the company "to capitalize on industry weakness while maintaining a strong balance sheet." Analysts seem to agree that the move will help, predicting that Seaspan will earn $0.84 per share this year, then grow that number to $1.35 in 2018, and nearly triple it to $2.23 by 2019.

The move is also expected to conserve cash and bolster free cash flow. After the company has spent three straight years burning cash, analyst expectations cited on S&P Global Market Intelligence show Seaspan burning more cash this year -- but getting its head back above water as early as 2018, and potentially generating even more cash in 2019.

For investors who had been depending on Seaspan's dividends to produce strong, dependable income to live on, that's small consolation. But for longer-term investors, cutting the dividend might turn out to be the move that rights the ship at Seaspan.

Rich Smith has no position in any stocks mentioned. The Motley Fool recommends Seaspan. The Motley Fool has a disclosure policy.