Overseas Shipholding Shares Rise

Overseas Shipholding Shares Rise to Record on Outlook
By Todd Zeranski
July 5 (Bloomberg)

Shares of Overseas Shipholding Group Inc., the largest U.S.-based oil-tanker owner, rose for a third day this week, touching a record, on improved earnings prospects because of high oil prices and strong demand for vessels to supply refiners.

The company has been helped by an ``underlying bullishness on the outlook for the second half for tankers,'' Omar Nokta, an analyst at Dahlman Rose & Co. in New York, said today in an e- mailed message. Nokta rates Overseas Shipholding shares a ``buy'' and owns none.

Shares of New-York based Overseas Shipholding rose $1.82, or 2.1 percent, to $88.27 in New York Stock Exchange composite trading after touching a record $88.77 earlier in the day. The stock has risen 8.4 percent this week and is 48 percent higher than at this time last year.

Crude oil for August delivery rose to a 10-month high of $71.81 a barrel today on the New York Mercantile Exchange, extending an 18 percent rally this year on strong demand for gasoline and concern over possible supply disruptions.

G. Scott Burk, an analyst at Bear Stearns Cos., raised his second-quarter and full-year earnings estimates for Overseas Shipholding on July 2, citing high rates for the company's Very Large Crude Carriers, or VLCCs, and Aframax tankers.

Slightly more than half of the company's ships have yet to be booked for 2008, enabling it to benefit from an expected increase in rates, Burk said in a note to clients.

The analyst raised his second-quarter profit estimate to $1.64 per share from $1.32 and his full-year estimate to $7.08 from $6.86. Burk rates the company's stock at ``peerperform.''