Danaos Corp (DAC)

[SirJoke]

Stable and crushing it again even with the turbulent markets.

[SirJoke]

BAZINGA!

[SirJoke]

DAC has been a beast since late Nov '20.
Could easily still double from here.

[gerard711]

Good reason to load up I hope you did

[grantastic]

heavy debt + quickly depreciating assets.

[1hot toddy]

y is this company selling for how much it made this year.

company made 8.50 share and sells for 8.50???

thx

[grantastic]

Amazing runup.

Interesting repurchase agreement.

[grantastic]

yes, i am surprised

the $10m is up to $0.40/share

if they exhaust the entire repurchase allocation they may reduce the outstanding shares by up to 10% or so.

This is also approximately 1/2 of a used vessel purchase.

[oil export]

Repurchase is a kind of dividend and in my opinion, a game changer.
https://seekingalpha.com/article/4364165-danaos-dac-corporate-presentation-slideshow

[grantastic]

Yes, Costas has proven his main priority is growing the fleet. That may be good and it may be bad, but it means people looking for a dividend shouldn't get their hopes up.

[oil export]

So you can dream of replacing the old fleet and growth.

[grantastic]

Recent Developments
In 2020, we acquired one 8,463 TEU container vessel and one 8,626 TEU container vessel, both of which have been fixed on two-year charters and in the aggregate are expected to contribute approximately $12 million to EBITDA on an annualized basis. Additionally, we entered into an agreement to acquire an 8,533 TEU vessel, which is expected to be delivered to us in the second quarter of 2020.

Time to stop dreaming about dividends. As always, Costas is sinking DAC liquidity into buying more ships.

[grantastic]

jeez good luck getting dividends in 2021 let alone 2020 with this trajectory

[grantastic]

Exactly. The board hasn't even discussed dividends.

[oil export]

Randall Giveans
Five years, 60%. All right. Second question. Obviously, following the successful equity offering, you're now permitted to reinstate dividends. So with that, what is kind of the timing or thoughts around that first dividend payment? And what amount do you plan on maybe proposing to the Board? Is it $0.10, $0.15, $0.20 a quarter? And then how do you plan on kind of deciding that amount?
John Coustas
Yes, Randy. Yes, sorry. I wasn't -- I forgot I was on mute. It was actually on the Board agenda to discuss about the dividend restatement. However, we deferred any kind of decision due to the uncertainty that was created by the coronavirus. It was a completely uncalculated event. So we prefer to defer that decision for the next Board meeting.
https://seekingalpha.com/article/4323162-danaos-corp-dac-ceo-john-coustas-on-q4-2019-results-earnings-call-transcript?page=3

[grantastic]

Maybe I'm wrong and next Q Costas will announce a dividend.

But I'm sure he won't.

[oil export]

I heard in the conference call that at one point an analyst asked about a dividend so they said they would consider a dividend after the report was published and the analyst said that with $ 300 million in cash flow, $ 10 million could be allocated to dividend.

[grantastic]

There is not going to be a dividend announced this quarter.

I do not understand why you think it will happen.

Costas never even suggested it was likely.

If you can find anything in the call transcripts to say a dividend is likely this Q, please quote it?

[oil export]

Maybe yes maybe not everything is possible

[grantastic]

So you agree with me: no dividend announcement in the next quarter.

Great.

When there are signs that the crisis is over, and not before Q1

[oil export]

When there are signs that the crisis is over, and not before Q1

[grantastic]

When?

i think they will pay/we will see

[oil export]

i think they will pay/we will see

[grantastic]

I read the conference call transcript.

Costas said the discussion of a dividend was postponed until the next board meeting. "Board Discussion" is of course a necessary step to issuing a dividend, but it alone doesn't make it guaranteed or even likely.

I personally don't think Costas is going to fire up a dividend right now when he's shown a propensity for buying up more ships ahead of all other uses of capital.

If Costas has learned any lessons from the last decade he'll hold off on the dividend OR ship purchases, and continue to pay down debt. But I'm not sure that's a lesson he's learned.

The past 7 years isn't "irrelevant" to the long-term shareholders who saw the market value of their DAC shares drop over 90%.

[oil export]

Did you hear the conference call? It was said there would be no dividend discussion in the past q1 years.
About the past 7 years, irrelevant, except the capital structure improved dramatically.

[grantastic]

Holding DAC for any sustained period in the past 7 years was a grievous financial mistake.

Now may be a decent time to buy. Who knows.

2019 free cash flow was 40% of current market cap so that's not bad. Even with shrinking revenues the reduction interest expense might balance that out.

Keep dreaming about a dividend in Q2, not going to happen. Not unless Costas gets very irresponsible and there's no indication he's that reckless.

ll not sell a share of a profitable company! The company leases ships to other companies and the situation hardly affects it. After Q1 there will be dividend distributions. In my opinion it fits Long and I bought yesterday.

[oil export]

ll not sell a share of a profitable company! The company leases ships to other companies and the situation hardly affects it. After Q1 there will be dividend distributions. In my opinion it fits Long and I bought yesterday.

[grantastic]

I wish I had shorted DAC

[oil export]

According to the presentation and conference call, First Dividend together with the first quarter report.
https://services.choruscall.com/links/dac200211.html
https://s2.q4cdn.com/951507448/files/doc_presentations/2020/02/DAC-Corporate-Presentation-February-2020.pdf

[grantastic]

Insiders are under water... again.... on their recent purchase.

ouch

[oil export]

https://seekingalpha.com/article/4311718-danaos-looks-like-cheapest-stock-in-market?utm_medium=email&utm_source=seeking_alpha
Target 30 $

[grantastic]

Insiders buying shares for $6/share.

This looks good until you remember that several years ago, insiders bought shares for $3.50... pre-reverse-split. That's about $49 post-split.

Despite the reverse split, DAC is again getting closer to breaching NYSE listing requirements. Another 50% drop means another reverse split would be required.

[oil export]

https://finance.yahoo.com/news/top-ranked-value-stocks-buy-153703783.html

[oil export]

There is nothing new and the stock is falling,How can a company earn $ 8.5 a share traded at $ 8.5?

[grantastic]

Looks like I nailed this prediction.

Based on past patterns, I'd sell now and re-buy in a few weeks.

[oil export]

A better position in the size of the debt and lower expenses on debt and an increase in profit and shareholders' equity

[grantastic]

I haven't owned DAC in about 5 years. The smartest investment I made during that time was to resist re-buying shares no matter how cheap they appeared.

Don't know what you mean by "much better position"... better position that what? Aside from blips, this stock has been a loser ever since it IPO'd.

[oil export]

Good luck ! Just keep in mind that the company is in a much better position and there is justification for the stock to continue to rise and a lot.

[grantastic]

Based on past patterns, I'd sell now and re-buy in a few weeks.

[oil export]

WOW
https://ih.advfn.com/stock-market/NYSE/danaos-corp-DAC/stock-news/79902264/danaos-corporation-reports-first-quarter-results-f

[oil export]

Strong buy
https://finance.yahoo.com/news/danaos-dac-moves-strong-buy-130001461.html

[grantastic]

Can you name the exact amount of debt you consider "acceptable"?

And you believe that 2 full years is "a few quarters"?

When you say "recycle debt" are you saying that in 2 years (i.e., start of 2021) you expect banks to start lending DAC money to buy more containerships?

Even if all true, I don't know how that helps the stock price... DAC borrowed billions of dollars already and where did it get them? Shareholder equity completely destroyed. It's proven incapable of creating value from the borrowed money.

Share price is like 70% lower than its lowest low during the height of the financial crisis.

Give a look at the balance of a very similar SSW company. I think they should have 4-8 quartets with cash flow similar to the last quarter to reach calming the banks and investors.

[oil export]

Give a look at the balance of a very similar SSW company. I think they should have 4-8 quartets with cash flow similar to the last quarter to reach calming the banks and investors.

[grantastic]

What is a "reasonable" level of debt in your opinion?

What do you mean by "recycling" of the outstanding debt? As in lenders will make new loans for DAC to purchase more ships?

how many is a "few" quarters? 3? 4?

[oil export]

I expect that in a few quarters the debt will fall to a reasonable level, the banks will allow for the recycling of the outstanding debt and the renewal of the fleet

[grantastic]

When do you expect the debt to be paid off?

What do you expect the value of the ships to be at that time?

[oil export]

I expect that the strong cash flow will reduce the debt and enable the renewal of the fleet of ships. As time passes the financial situation improves and in the first stage the target is at least $ 3 a share.

[grantastic]

Which price do you expect a reversion to? $30/share from the 2007 era? $6/share from 2015?

How does the impending long-term charter expirations from now -> 2024 play into your thinking?

[oil export]

https://ih.advfn.com/p.php?pid=nmona&article=78692116&symbol=DAC
The report is excellent and far above expectations, the balance has improved greatly. The price of the share should revert to the price that was in the distant past.

[oil export]

All Greek shipping companies are rising like DCIX TOPS and more