Follow Shipping Stocks?

[Dawg52]

Looks like all the $2 shares I bought are working out.

Congrats! I barely had the b*lls to hang on to what I had. I guess that's why I suck at investing.

 

[brewer12345]

Congrats! I barely had the b*lls to hang on to what I had. I guess that's why I suck at investing.

At that point I figured I might as well have the courage of my convictions because if it didn't work out I was almost broke anyway.

 

[TeeRar]

ETF for shipping stocks

I did not read thru all 400 posts but there is an ETF - SEA. Thinly traded

I am thinking again about dry bulk. NM, EGLE, DSX. I notice that EGLE suspended it's dividend this year. On the other hand Fidelity reports that NM & DSX have more aggressive accounting standards.

I am looking for a dividend stock but don't want one that can't sail through rough financial seas. Comments, please, from those that follow the industry.

 

[dm]

NM, SFL, and FRO have all bounced back, but I still have a way to go with DSX and EGLE. Im way down % wise on EGLE, but thankfully not a big holding.

I added to NM, SFL, and FRO on the way down so that helped.

Whats up with EGLE? Are they down and out? I don't like the fact that its not really moving like the others.

 

[brewer12345]

I think it boils down to a simple question with EGLE: can they cover their committed capital outlay and how will they do so? DRYS did it by busting out shareholders via the issuance of an enormous amount of very dilutive shares just to stay alive. EGLE appears to have avoided that thus far, but they still have a big outlay to cover.

 

[unclemick]

EGLE stock is my Saint's back in the decades when they never made the playoffs.

Hope springs eternal. Plus it's a very small holding - to keep the hormones happy. The Norwegian widow is still ticked about the div cut though.



I have more heartburn with my financial sector stocks - more likely to favor dragging out the guillotine on those guys - BAC, JPM, C, UBS.

heh heh heh - shipping in my mind as always more of a deep cylical crap shoot. .

 

[brewer12345]

EGLE stock is my Saint's back in the decades when they never made the playoffs.

Hope springs eternal. Plus it's a very small holding - to keep the hormones happy. The Norwegian widow is still ticked about the div cut though.



I have more heartburn with my financial sector stocks - more likely to favor dragging out the guillotine on those guys - BAC, JPM, C, UBS.

heh heh heh - shipping in my mind as always more of a deep cylical crap shoot. .

FWIW, I think there is a lot of value in the shipping names. Still waiting to see if EGLE can cash the check they wrote on new ships, but if they succeed in doing so it could be a real home run from current levels.

I am heavily weighted in the sector at present. NM and ULTR with a wodge of NNA warrants (AKA lottery tickets) on the side.

 

[dm]

Crap!

 

[brewer12345]

Crap!

 

[dm]

Its what I think when NM drop's more than 8% in a day.

 

[73ss454]

Wasn't so bad, I bought another 1000 NM just for the heck of it

 

[brewer12345]

Not clear to me what people freaked out about. Company has a ton of ships being delivered that will add greatly to earnings, plus they made it pretty clear in the earnings presentation that the port operations are about to have a great year. In the meantime, they are scooping up more ships on the cheap and paying dividends. The market action today was nuts.

 

[samclem]

Here's what today's WSJ had to say about the Baltic Dry index:

LONDON—Uncertainty over how many new ships will be built this year is expected to marginalize a popular measure of the global economy's health—the Baltic Dry Index.
The index, a measure of shipping costs, gained importance over the last decade as a key gauge not just for the shipping industry but the global economy. Due to the shipping industry's stable supply structure, the index was touted as a good proxy for overall demand for raw materials, the basic building blocks of an economy.
But with an unusually large number of ships scheduled to come into operation in 2010, the index no longer presents such a straightforward view of raw-material demand, and hence economic growth.

. . .
Ships take about three years to build, making supply both easy to predict and relatively inflexible. Moves in the cost of shipping have, therefore, been largely the result of fluctuations in demand for the commodities they carry.
But the stability is now faltering, some analysts say.
"What you're witnessing is a huge number of ships ordered during the peak of the market in 2007-08 being delivered now due to the usual lead times involved," said Amrita Sen, a commodities analyst at Barclays Capital in London.
. . .

"The BDI can reflect increasing levels of global trade, but it can give misleading impressions, especially with the supply issues this year," said Lambros Varnivides, head of shipping finance at Royal Bank of Scotland in London. . . . While the index might not be an ideal guide, Mr, Varnivides notes that other indexes can be useful complements.
He said the Australian Coal Port Congestion Index and Capesize Iron Ore Port Congestion Index for China, both published by Simpson, Spence & Young, a major shipbroker, are worth watching, along with the Baltic Dry Index.

Provided for info only--I don't know anything about shipping.

 

[IndependentlyPoor]

I don't know diddly poop about shipping or commodities either, but this seems interesting...
The Big Picture » Blog Archive » Does Baltic Dry Freight Index Lead Commodity Prices ?

 

[brewer12345]

Looks like my NNA-WT lottery tickets may be paying off: Navios Maritime Acquisition Corporation to Acquire 13 Tankers for $457.7 Million - Yahoo! Finance

Navios Maritime Acquisition Corporation ("Navios Acquisition") (NYSE:NNA - News) announced today that it has signed a definitive agreement pursuant to which it will acquire a 13-vessel fleet, comprised of 11 product tankers and two chemical tankers. The aggregate purchase price is $457.7 million, of which $123.4 million will be paid from existing cash and $334.3 million from debt financing. Navios Acquisition will also have options to purchase two additional product tankers for $40.5 million per vessel.
Angeliki Frangou, Chairman and Chief Executive Officer of Navios Acquisition, stated, "We are pleased to announce this transaction; Navios Acquisition will be a platform for building a world-leading operator of modern, high-quality product and chemical tankers. We are excited about building another company in the shipping sector and believe that the attractive market dynamics make this an ideal opportunity for leveraging our global network of relationships and world-class skills developed in building Navios Holdings into one of the preeminent dry bulk shipping companies."
Ms. Frangou continued, "We have successfully built shipping companies before. Since taking control of Navios Holdings in August of 2005, we grew the fleet from six owned and 22 chartered-in vessels, representing 1.8 million dwt, to 32 owned and 27 chartered-in vessels, representing 6.4 million dwt. We thus grew Navios Holding's fleet by 256%, in dwt. In addition, in 2007 Navios Holdings launched Navios Partners on the New York Stock Exchange, and Navios Partners currently has a fleet of 13 vessels. In total, the Navios group now controls 72 dry bulk vessels, with an aggregate of 7.5 million dwt, representing 317% fleet growth by dwt. Today, the Navios group has a combined current enterprise value of $3.0 billion as compared to Navios Holdings' enterprise value in August 2005 of $0.6 billion, representing 414% growth. We aim to replicate these achievements in the tanker sector through Navios Acquisition."

 

[73ss454]

Looks like good news, maybe my 7K shares will payoff after all. Another $3.50 and I'll be even and then off to the races. (heh)

 

[BUM]

Wasn't so bad, I bought another 1000 NM just for the heck of it

THATS what I'm talkin' about!.... my man!

 

[MWaterman]

I'm in Pacer International. I bought in at $5.92. I would have gotten them cheaper but I hadn't heard of them before two weeks ago. I got one of their annual reports in the mail and I spotted a turnaround in their business coming. It think it's going to be good.

 

[Brat]

Picking up this subject again... There will be a lot of wheat on ships this year so I looked again at dryships. NM, and DSX are paying dividends and making profits in excess of the dividend but analysts think they stink. EXM, however, is making a 10% profit but not paying a dividend and rated a buy. Any news about this sector that would make me want to buy?

 

[brewer12345]

Picking up this subject again... There will be a lot of wheat on ships this year so I looked again at dryships. NM, and DSX are paying dividends and making profits in excess of the dividend but analysts think they stink. EXM, however, is making a 10% profit but not paying a dividend and rated a buy. Any news about this sector that would make me want to buy?

I would stay far away from EXM. They made a huge bet buying Quintana in a leveraged deal at the top of the market and they are still dealing with the hangover.

I like NM, which is increasingly much more than a dry bulk company. They own 2/3 of a large South American barging and port operation which will be a direct beneficiary of a shift in wheat exports originating from Russia to South America. They also own about 2/3 of a newly formed tanker company (symbol NNA) that is about to have a nice fleet of both clean and dirty tankers. They also own the general partner and 1/3 of the limited partner inetrest in NMM, a dry bulk MLP. NM is also unique in that they have very long duration charters (some with profit sharing) that are backed up with third party charter default insurance provided by an agency of a AA+ rated EU government.

DSX has a very solid balance sheet. Its not clear of the stock is a raging bargain.

Somewhat more speculative, but GNK appears awfully cheap.

The big question for teh sector is the overhang of newbuild orders vs. demand. I like NM in part because the potential impact of such is heavily muted due to increasing diversity of what they own and their tendency toward very long charters.

 

[CCdaCE]

At the risk of [-]reading financial porn[/-] beating a dead horse...

I see that shipping companies were getting cheaper today. Examples: DSX, NM. Ran across this article that attempts to explain why. Don't know if it's valid, or not, but seems to make logical sense in the Aussie sense. I'd think that emerging markets are picking back up compared to ours, or maybe it's still a question of when China will go full throttle again.

Just interesting, that's all.

-CC

 

[brewer12345]

Basically the disruptions to the Aussie export areas have thrown the dry bulk market into disarray temporarily. But all those coal fired power plants still need fuel and the world still needs steel, so when they drain out Australia you will see an absolute mess as everyone tries to ship as much as possible as quickly as possible.

The smackdown of some of these names today is that Korea Line filed for bankruptcy and they are a major charterer. EGLE in particular has a lot of exposure. NM has some exposure, but they have always had iron-clad counterparty default insurance on their charters, so all they would be on the hook for would be the insurance deductible.

 

[Lakedog]

Brewer, what is your take on NM currently? Too soon to add more here? I've been reinvesting the divs -- the shares start to add up after a while. If they had not kept their div, I'm not sure I would have held this long. I am still in the black though since I added during the sale in the low $2s.

 

[brewer12345]

Brewer, what is your take on NM currently? Too soon to add more here? I've been reinvesting the divs -- the shares start to add up after a while. If they had not kept their div, I'm not sure I would have held this long. I am still in the black though since I added during the sale in the low $2s.

This is a long term investment for me, so I am holding. No idea if it is too soon to add, since I think the stock was cheap at $6. None of this really makes a whole lot of difference to NM, as far as I can tell, since their charters are generally both long term and insured against default.

I also expect them to spin off the S American port operations at some point. Those are a gem.

 

[BUM]

EGLE $4/ share ALL ABOARD!