Follow Shipping Stocks?

[NW-Bound]

I bought about $20K worth of shipping stocks (EGLE, NM, DSX, PRGN) in 2009-2010. Took a loss of about $5K and bailed out on Jan 11 after reading this article. An excerpt follows. The vision of new huge ships stretching 35 miles scared me.

While Clarkson Plc, the world’s biggest shipbroker, expects seaborne trade in the two cargoes to exceed 2 billion metric tons for the first time this year, the 7 percent increase won’t be enough to eliminate a glut. About 200 capesizes, spanning some 35 miles end-to-end, will leave shipyards this year, expanding the fleet by 18 percent, the Bloomberg survey showed.​

 

[Nords]

EGLE $4/ share ALL ABOARD!

Holy crap, I remember in mid-2007 we were all [-]kicking ourselves[/-] patting ourselves on the back for "selling too soon" at $25-$30/share.

I'm betting I didn't miss a 10:1 stock split, either...

 

[BUM]

I bought about $20K worth of shipping stocks (EGLE, NM, DSX, PRGN) in 2009-2010. Took a loss of about $5K and bailed out on Jan 11 after reading this article. An excerpt follows. The vision of new huge ships stretching 35 miles scared me.

While Clarkson Plc, the world’s biggest shipbroker, expects seaborne trade in the two cargoes to exceed 2 billion metric tons for the first time this year, the 7 percent increase won’t be enough to eliminate a glut. About 200 capesizes, spanning some 35 miles end-to-end, will leave shipyards this year, expanding the fleet by 18 percent, the Bloomberg survey showed.​

Add the expected demand subtract the ships being scrapped, net is not doom and gloom. Time will tell.

 

[NW-Bound]

I hate it when I couldn't stand something no more , and bailed out at the bottom.

What if this sector comes around, now that I am out?

OK, OK, I lied to you.

I did not sell all the shipping stocks I had. I still keep NM, which I have read is the strongest of the bunch (and its relative price strength reflects that). In fact, I still have 28% gain on my lot of NM, as I started to accumulate it from 11/2008 to 3/2010. The other stocks, bought at roughly in the same time frame, gave me a loss.

I first dabbled in shipping stocks in 2007 with DRYS. I bought 150 shares in 6/2007, paying $37. Just 5 months later, the stock reached bubble territory with the price of $130 when the day rate reached $300K. People on CNBC started talking about it. So, I sold 50 shares at $126 to recover my original cost of the entire lot.

The stock started to unravel soon after that, but I did not sell the remaining 100 shares until 7/2008 at $71. In all, I netted near $8K out of this trade on DRYS, or more than doubling my investment.

I did not buy shipping stock again until the end of 2008, but decided that the days of DRYS were over, and started to accumulate other stocks. And as I have told the story earlier, none made me money but NM. But when the earlier gain on DRYS was added, I still have a net gain on this dabble into a sector I still know little about.

When I play with risky individual stocks like this, I keep my involvement to just a fraction of 1% of portfolio in each position. Therefore, when it works out, I do not strike it rich, but do not lose my shirt otherwise. I do not have more than 2% in any single stock. Larger positions are usually in ETFs for diversity.

It's just a thing I do for fun. I fancy myself being my own MF manager, and yet I still have only around 100 stocks. Wellesley has something like near 700 positions, if I remember correctly.

 

[dm]

How do things look now?

 

[haha]

I fancy myself being my own MF manager, and yet I still have only around 100 stocks. Wellesley has something like near 700 positions, if I remember correctly.

You "manage" a portfolio of 100 individual securities?

I couldn't even remember the names or businesses of 100 securities, let alone any other information about them. I usually have 10 to a max of 20, though I may have fewer when I am more concentrated in cash.

I usually have minimal turnover, though I believe I turned over almost the entire lot in 2008

Ha

 

[haha]

How do things look now?

I know NM has been making new 52 week lows, and is back near its lows of the credit crash, but I have no idea how the business is going, or if there are any real problems.

My first requirement is cheap; so NM meets one important test.

Ha

 

[brewer12345]

I know NM has been making new 52 week lows, and is back near its lows of the credit crash, but I have no idea how the business is going, or if there are any real problems.

My first requirement is cheap; so NM meets one important test.

Ha

Only thing that has really changed for them in the last month is investor sentiment.

 

[Brat]

What is the difference between NM & NMM? Which would be the smarter buy?

 

[brewer12345]

What is the difference between NM & NMM? Which would be the smarter buy?

NMM is an mlp that owns a fleet of ships with long term charters and modest leverage. It is a cashflow vehicle, it is generally overvalued vs. NM, and as General partner NM gets an increased percentage of its dataflow as distributions rise. NM is a holding company owning stakes in NM, NNA, a south American logistics business which will eventually be ipo'd, and its own fleet. It has more debt than NMM but is way cheaper. I own NM over NMM. The CEO owns about a quarter of NM but a tiny bit of NMM. I think she is one of the sharpest edges in her industry, so I am happy to ape her investments.

 

[Brat]

Great to hear that a gal can handle the old salts!!!

 

[brewer12345]

Great to hear that a gal can handle the old salts!!!

She sometimes gets short shrift due to a thick accent, but she is a lawyer, was an investment banker and has spent 20 years in the industry. If I were not settled I would see if she would hire me. I have spoken to several of her exec team and they are uniformly sharp.

 

[clifp]

So with all of the turmoil over the Greeks debt, what is the odds that various Greek shipping companies will be affect by a default? I see that NM still paid its dividend is that likely to continue. Any thoughts about EGLE at $1.71 it seems to me roughly 1/6 of the price I last traded it. I know the company is pretty highly leveraged but can it still service its debt?

 

[brewer12345]

I would pick the names that appear most likely to make it. NM, NMM dsx and perhaps gnk I a Lao really like product tankers from here, especially nna and stng . I f you are patient you can bit nna first mortgage bonds at a double digit yield.

 

[CCdaCE]

I couldn't take it any more. I plopped out my whopping $610 and bought 200 shares of NM at $3.05. Mad money. Lets see where this ride takes me.

Maybe their dividend gets paid today and I should've waited. But, I figured it was after the record date, so, what the hey...

This presentation sold me, too.

-CC

 

[haha]

I couldn't take it any more. I plopped out my whopping $610 and bought 200 shares of NM at $3.05. Mad money. Lets see where this ride takes me.

-CC

Couldn't be very far; don't spend all your winnings taking the family to Starbucks

 

[CCdaCE]

Hey, if it gets back to where it started the year or anywhere near book value, I'd have enough for a week of Starbucks! Crazy!

-CC

 

[73ss454]

I noticed NM moved up 20% this AM. Only a few 100% more and I'll be even.

 

[dm]

I noticed NM moved up 20% this AM. Only a few 100% more and I'll be even.

I only need it to hit $6.00. Are we there yet?

 

[73ss454]

Not yet but it's up 23% right now, I'd like to know what's causing this. Someone mentioned that Cramer said something about NM. Is he that powerful to make a stock move 23%?

 

[Brat]

It doesn't take much $ to move a thinly traded low priced stock 23%.

I gave a quick look at the industry a couple weeks ago and researchers think the charter rates are still very soft and dropping (reminded me of home valuations). NM is the best firm in the industry but I took a pass.

 

[brewer12345]

Not yet but it's up 23% right now, I'd like to know what's causing this. Someone mentioned that Cramer said something about NM. Is he that powerful to make a stock move 23%?

JP Morgan installed a new head shipping analyst after the previous guy (Jonathan Chappell) boogied off elsewhere for a big paycheck. The new guy started coverage today and put a strong buy on all the public Navios entities (NM, NNA and NMM). I think they are all grossly undervalued, but it is anyone's guess if this is a flash in the pan.

 

[Brat]

Is NNA still worth buying?

 

[Brat]

Any reason why DLNG wouldn't be a good stock?