Will Nordic American Tankers Whiff on Revenues Next Quarter?

There's no foolproof way to know the future for Nordic American Tankers (NYSE: NAT  ) or any other company. However, certain clues may help you see potential stumbles before they happen -- and before your stock craters as a result.
A cloudy crystal ball
In this series, we use accounts receivable and days sales outstanding to judge a company's current health and future prospects. It's an important step in separating the pretenders from the market's best stocks. Alone, AR -- the amount of money owed the company -- and DSO -- the number of days' worth of sales owed to the company -- don't tell you much. However, by considering the trends in AR and DSO, you can sometimes get a window onto the future.
Sometimes, problems with AR or DSO simply indicate a change in the business (like an acquisition), or lax collections. However, AR that grows more quickly than revenue, or ballooning DSO, can also suggest a desperate company that's trying to boost sales by giving its customers overly generous payment terms. Alternately, it can indicate that the company sprinted to book a load of sales at the end of the quarter, like used-car dealers on the 29th of the month. (Sometimes, companies do both.)
Why might an upstanding firm like Nordic American Tankers do this? For the same reason any other company might: to make the numbers. Investors don't like revenue shortfalls, and employees don't like reporting them to their superiors.
Is Nordic American Tankers sending any potential warning signs? Take a look at the chart below, which plots revenue growth against AR growth, and DSO:

Source: S&P Capital IQ. Data is current as of last fully reported fiscal quarter. FQ = fiscal quarter.

The standard way to calculate DSO uses average accounts receivable. I prefer to ! look at end-of-quarter receivables, but I've plotted both above.
Watching the trends
When that red line (AR growth) crosses above the green line (revenue growth), I know I need to consult the filings. Similarly, a spike in the blue bars indicates a trend worth worrying about. Nordic American Tankers' latest average DSO stands at 102.5 days, and the end-of-quarter figure is 117.3 days. Differences in business models can generate variations in DSO, and business needs can require occasional fluctuations, but all things being equal, I like to see this figure stay steady. So, let's get back to our original question: Based on DSO and sales, does Nordic American Tankers look like it might miss it numbers in the next quarter or two?
Investors should watch the top line carefully during the next quarter or two. For the last fully reported fiscal quarter, Nordic American Tankers' year-over-year revenue shrank 56%, and its AR grew 9.8%. That's a yellow flag. End-of-quarter DSO increased 149.3% over the prior-year quarter. It was up 186.6% versus the prior quarter. That demands a good explanation. Still, I'm no fortuneteller, and these are just numbers. Investors putting their money on the line always need to dig into the filings for the root causes and draw their own conclusions.
What now?
I use this kind of analysis to figure out which investments I need to watch more closely as I hunt the market's best returns. However, some investors actively seek out companies on the wrong side of AR trends in order to sell them short, profiting when they eventually fall. Which way would you play this one? Let us know in the comments below, or keep up with the stocks mentioned in this article by tracking them in our free watchlist service, My Watchlist.

• Add Nordic American Tankers to My Watchlist.

Why Are Atheists So Obsessed With God?

Michele Bachmann raised eyebrows again last weekend when she claimed that Hurricane Irene was God's way of sending a message to American politicians to listen to the American people. Although the allegation that God would kill Americans in order to get politicians to listen to those same Americans is strange enough (wouldn't he kill the politicians themselves or their first born sons, not the people whose voices he wished to be heard?), many were amused by the thought that one of the leading presidential candidates believes that God causes natural disasters in a show of support for her policies. Others agreed with her and one group in particular was pulling its hair out after hearing Bachmann's latest sound bite.
Atheists complain that religion is irrational, has no basis in fact and shouldn't play a part in national politics. Still, it's odd that they will condemn politicians like Bachmann for bringing God into a political discussion, yet they throw their support behind leaders like President Barack Obama, a Christian who says that he is opposed to gay marriage because "God is in the mix". (A weak attempt at making his Christianity sound cool). Hmm, Michele Bachmann is crazy for thinking that there is a God who backs her political agenda but President Obama is just fine even though he's against letting consenting adults who love each other marry because the same God says no?
Why is it that so many atheists who feel that anyone who believes in God is delusional and should seek help support leaders like President Obama? If believing in God is a sign of mental illness, would you really want a man who is suffering from this delusion to have a nuclear arsenal at his disposal?
One reason is that, like many Republicans, they don't really believe that Obama is a Christian. Not surprising, considering that this is the man who said that guns and God were something for bitter, small town Americans to fall back on when he said that "they get bitter, they cling to guns or religion or antipathy t! o people who aren't like them."
It never ceases to amaze me that besides religious fundamentalists it's the people who don't believe in God who want to push their religious views in your face the most. Of all the Christians, Muslims, Buddhists, Jews and agnostics that I personally know, none of them seem interested in making me accept their personal beliefs. Just as important, none of them go out of their way to insult members of other religious faiths. Most of them seem to believe that whatever faith you belong to is a personal choice and that if it brings comfort without harming others, than any religion can play a positive role in one's life.
However, it's always the atheists that seem to feel a need to insult others who don't share their views. I don't know if they realize it but when mocking anyone who happens to believe in God (they're criticism is usually aimed at Christians because criticizing other religions too much might mark them as racists or close-minded) atheists often sound much like the people they claim to despise the most: religious fundamentalists. Claiming that anyone who doesn't share your beliefs is misguided, delusional or just plain wrong is a tactic used by fundamentalists of every religion.
When they get on their soapbox, atheists don't sound much different than the Westboro Baptist Church members who enjoy protesting at the funerals of fallen soldiers, shouting insults about God's wraith at the people who are trying to comfort each other while mourning the loss of a loved one. An example of this is my fellow writer at Benzinga who thinks that anyone who believes in God is crazy. Another funny thing is that if you get away from talk of religion and ask them about the people they admire, most atheists will name many people of great faith such as Mohandas (Mahatma) Gandhi and Martin Luther King Jr.
While I understand the frustration caused by hearing a politician like Michele Bachmann claiming that a deadly natural disaster like Hurricane Irene is also a message f! rom God that just happens to be right in line with her own political opinions, there's no need to insult every member of every religious faith because of the words uttered by one headline seeking politician.