NAT - Nordic American Tankers: Green Shoots Overshadowed By New Omicron Risks

• Nordic American Tankers has suffered immensely from the current downturn that sees their survival down to the wire.
• Their cash burn only worsened during the third quarter of 2021 with their operating cash flow hitting a negative $16.7m.
• Whilst they have seen green shoots of a recovery in their recent charter rates, this could easily get derailed by the new Omicron Covid-19 strain.
• If not for issuing equity, their cash balance would have fallen beneath $30m and thus breached their debt covenant, thereby causing bankruptcy.
• Since their survival is still down to the wire and now heavily influenced by the new and unpredictable Omicron strain, I still believe that only a neutral rating is appropriate.

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