Seaspan (NYSE:SSW) came out with its expected dividend increase. And while the increase wasn't as much as I had hoped for, it was nonetheless a healthy bump of 25%. The May $20 calls that I hold in my Special Situations portfolio continue to be over my purchase price, but with time value rapidly eroding, I'm electing to sell them.

The quarter
Seaspan turned in a decent quarter, with revenue up 9% and distributable cash flow up 8%. Solid gains, to be sure. But the company has elected to continue growing its fleet, adding as many as 15 ships this year and another 15 within a few years. The company is trying to take advantage of the weak pricing environment and wants to use its strong balance sheet to help it move clearly into the leading company in the containership industry.

To the extent that it can do this without issuing equity, the better the stock should perform in the long run. So management is positioning the company for excellent performance longer-term. That's why I'm not too disappointed by what I view as a lower-than-expected dividend increase this year. More ships should equal a longer runway for a growing dividend.

I'm electing to keep the May $20 put position for now, since time value is working in our favor here.

So I'm closing out my position of 10 contracts of May $20 calls.

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