JJC:    What if I told you that there was a stock that could give you a huge dividend... a huge yield... and, when I say huge here, I'm not talking about a relatively puny, 5%, 6%, or 7% yield... No. I'm talking about giving you a morbidly obese double-digit yield... a yield that needs a tummy tuck!... And, at the same time, could potentially deliver serious, maybe as much as 25% upside...

Would you call me crazy?...

You don't often find these two things together... capital appreciation, capital preservation... but I think I've got it... I've got it all in one stock... I've got to go to Scandinavia to give it to you, but that's okay... because it trades here... and that stock is...

...Nordic American Tanker (NAT)!...

NAT is an oil tanker stock, and tanker stocks typically have zobtic yields, but NAT stands above the rest!... But, beyond that, this is a great time for oil tankers, at $125 oil... because spot prices for using these tankers are going higher and higher...

We've like other oil tanker stocks, and you know which one we've liked all the way... Frontline (FRO), which is up 17% since I recommended it on July 23rd of last year... giving you a 36% gain, when you include the dividend payouts... I see NAT as the next FRO...

NAT just reported earnings this week... Their earnings per share were below consensus estimates. I did wait for that... I feared that... But the company raised its quarterly dividend to $1.18, to be paid to shareholders of record on May 23rd...

Now, listen... That dividend is double the size of the dividends that NAT paid in the 3rd and 4th quarters of 2007. I'm not so concerned about the missed earnings report, because spot rates are going up huge... NAT tankers are making... okay, these are numbers (i.e., metrics) that are normally associated with hedge fund managers... making $46,600 per day... Last year, they were making $27,000 a day, in the previous quarter; that's why we stayed away from these guys. I think the rates are going higher...

NAT typically uses dividends to forecast the future of profits. But, before we talk price increases, let's take a look at the company...

NAT has a fleet of 12 Suez Max double-hulled tankers... with two more under construction that should join the fleet between 2009 and 2010... A Suez Max is one that can fit through the Suez canal... These are smaller than the largest oil tankers which, in professional parlance, are called VLCCs... Very Large Crude Carriers...

Of NAT's 12 tankers, 11 are contracted at spot prices, meaning they're contracted out at whatever the current price is... they've got the leverage... And, right now, those prices are high... Average Suez Max spot rates, between January and April, $60,000 a day... higher than $46,000 that NAT reported in the latest quarter, the one that people didn't like...

What's causing these high rates?...

For one, OPEC (i.e., oil-producing exporting countries) production has increased the volume of oil imports to the West... Well, of course, prices are up... wouldn't they be doing that?... That means more demand for tanker space...

Beyond that, oil tanker stocks are very simple... They don't trade off the price of crude, so to speak... They're levered off the price of transporting crude... and that's determined by the number of oil tankers out there... Prices are high, and should stay high, because some of the largest oil tankers, the VLCCs are exiting the market, being converted to dry bulk ships... and oil platforms... That means that VLCC fleet growth should be flat. That's the competition...

We also know from NAT's latest quarter that Suez Max fleet growth stayed flat too... Again, no more ships... Again, we stayed away from this group, because the ships were being printed... they were putting so many of them out there... No more...

So, we've got high rates, and it looks like we're not adding ships... That's a recipe for rates to go higher...

And... you want trust?... The CEO, Herbjrn Hansson... I call him the IronMan of the Suez Max industry...

Now let's throw in something else... ships being taken off the market...

By 2010, 46 single-hull vessels - remember, our guy is double-hulled - should be taken off the market. You've also got Suez Max tankers being converted to offshore vessels, the dry bulk carriers... the same types of ships that NAT uses...

We also know that Iran is doubling the amount of oil that they're storing in idle tankers in the Persian Gulf, taking tankers off the market... again, increasing prices. Remember, it's the supply and demand of ships...

Last year, an oil spill in Korea also increased the demand for double-hull tankers. All of NAT tankers are double-hulled... That's helping to keep the spot rates high... All of this talk about spot rates is important, because they determine the size of NAT's dividend distributions, and that's why you want the stock...

I gave you all of that stuff so you understood why I am confident that this outsized dividend could even go higher... It's the $60,000 per day... that's the number I threw at you earlier for January... If that goes up... if it's correct, then NAT's dividend payout for the current quarter could be around $1.56 per share... Hey, it's not me saying just that... Bear Stearns is saying it.

Now you're talking about an implied yield of 17%...

Remember, the dividend they just announced for the last quarter was $1.18... so now it's 11.2%....

This is a company that's already paying out a massive dividend. To me, it looks like it's going to get even bigger...

Now, the Street is a lot less bullish than I am, when it comes to tankers... Of the 10 analysts covering NAT, only three have buys, against five holds, two sells... What have they got against the Scandinavians?... What is that all about?... They never hurt anybody.

The Street expects tanker rates to pull back in the second half of the year, as supply grows... I think that's a faulty assumption... I think they're stupid... I think they're wrong... I think they're morons... I can't see the supply of tankers growing fast enough to knock rates down...

The number of double-hulled VLCCs available in the next 30 days has been cut in half over the last month, from 56 to 28... Where are these analysts? Why are they taking this into account? Why am I the only one doing the work here? Oh... that's right... because I'm not paid billions of dollars, like they are.

This does not seem to be in the market, where supply is expanding... you just don't get that, with this kind of work...

Where does this put NAT?...

The tanker stocks trade, based on their yields... If NAT trades up to a 9% yield, which would put it inline with the other tanker stocks, you've got 25% (projected increase) in the stock...