Why Frontline (FRO) Stock Is Falling Today

NEW YORK (TheStreet) -- Frontline (FRO) was falling -13.8% to $2.23 Thursday after announcing that it is considering alternatives to repay its convertible bond loan.

The shipping company, which is currently $1.03 billion in debt, said that it is considering financing alternatives to raise the cash to pay a $190 convertible bond loan due April 2015. Alternatives include raising equity, selling assets, establishing new loans, or refinancing existing arrangements. "A full restructuring of the company, including lease obligations and debt agreements might be the only alternative," the company said.

The company discussed the alternatives in its second quarter earnings report, in which the company reported a loss of -23 cents a share.

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TheStreet Ratings team rates FRONTLINE LTD as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate FRONTLINE LTD (FRO) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself and generally high debt management risk."

You can view the full analysis from the report here: FRO Ratings Report

FRO Chart FRO data by YCharts

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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