OMI Corporation

OMM

Company. "OMI Corporation provides seaborne transportation services for crude oil and petroleum products in the international shipping markets." (company website)

Buy. I bought OMM about six weeks ago after the stock broke the $12 level. It has been rising steadily for the past year (see sidebar), and it seemed time to catch the wave. And sure enough, OMM did continue to rise—

Until, that is, the company issued a gazillion new shares (thereby diluting the value of existing shares), and there was a big sell-off. But, except for the initial drop, the price didn't change a whole lot that day. Hmmm...

Sell. Two days ago, OMM reported what I thought were stellar results: net income for the first six months of the year exceeded full-year net income for any year in the company's history; they are expanding and modernizing their fleet; and they gave an optimistic outlook for the remainder of the year. This morning, a brokerage firm upped OMM's rating to "sector outperform." There was a huge sell-off!

No good deed goes unpunished!

I put in a sell-order to preserve gains at $1 per share.

I suppose it was inevitable that there would be a correction for OMM: the stock has more than doubled in price over the past nine months; today's open is almost 20% above the 50-day moving average and more than 40% above the 200-day moving average; and it has been almost two months since the price has pulled back to the 50-day average.

The market is just crazy— company after company is beating expectations, but the Dow Jones Industrial Average has fallen back below 10,000, and the Nasdaq is at a low for the year. In this environment, I guess I should be grateful for profits, wherever and however I can get them.