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wonder what DRYS will be trading at on Monday if an agreement is announced by Trump and Xi tomorrow?
According to the latest financials, NMM has a book value of ~$4.50 per share. It's making money and on track to grow revenues. As the container ships are sold, it seems that debt could be paid off, other assets purchased, distributed to unit holders, or some combination.
My assumption is the pps is down due to parent NM. Any one have any insights?
1 for 10 RS will leave the OS at about 12 million shares. Wonder how many new shares will be distributed to start improving the balance sheet?
Very low volume so far today. Seems no one wants to sell at the moment. If Trump and Xi put a deal together tomorrow, shipping should have a very nice pop.
MM's tried to take the pps down this morning. Looks like that failed. Keeping an eye on this. Seems about ready to run.
DD - I've given some thought to GE taking DRYS private and discarded it. DRYS is his golden goose and I doubt he would jeopardize not being able to tap American investors pretty much at will. I suspect the obvious big buys recently was to put a floor on the pps and also start driving it higher. My guess is his plan is to move the pps to or above book value and then sell a few of his shares for the balance of the buy back.
DD - I don't see the pps ever getting back there. However book value is roughly $7.40 at the moment. My guess is GE will continue buying shares if the pps stays at this level. If the pps takes off to a much higher level though, I suspect he will sell a small portion of his shares for the inflated price. Either way the number of outstanding shares seems headed to ~85 million or something closer to an $8 book value. Some of the algebra will likely also change as the VLGC's move off the books and the additional dry bulk ships added. Regardless, the pps is still far below book.
jelliis - the numbers appear to be good for NMM. If the containers are moved into the spinoff, the transaction should be net positive with the associated debt moved off NMM's books along with the sale actually being profitable. There is a large amount of debt coming due in 2020, which is a concern. Looking for that to be restructured. All in I don't see bankruptcy in the cards.
My guess is the pps is going down due to the risks associated with NM, which is a mess.
New filing out - 90 million shares outstanding. DRYS has repurchased almost 1.3 million shares since the last report on 11/19. Roughly 18 million shares trading with 2.1 million shares sold short (as of 11/15).
surfer - not sure how the China's belt and road strategy would change or why that would come into play with a US/China trade negotiation. Assuming they come to some sort of agreement though, tariffs would be lifted allowing for more bilateral trade. From a drybulk perspective, that would likely lead to more tonnage of grains shipped from the US to China. More ton miles = more revenue for drybulk.
The VLGC sales should already be complete making way for the new dry bulk ships. While I won't comment on the continued GE double dealing, the fact is there is more money to be made with the new bulkers versus a locked in revenue stream from the VLGC's. 4Q and 1Q should both be positive for DRYS revenues.
If Trump and Xi announce a trade agreement later this week, shipping stocks should pop from there. otherwise it could just be treading water through the end of the year.
Book value based on Q3 financials is $7.30. Should be closer to $8.00 by year end.
Based on the net earnings reported for the 9 months this year and the current 91 million shares outstanding, DRYS has a 0.175 eps. I am quessing 0.20/share for 4Q, which would bring the full year eps to 0.41 for the full year. That again is based on the 91 million OS. At the pace GE is buying shares back though, I am guessing the OS will be ~82-83 million by year end. That would put the eps at ~0.44 or a PE somewhere around 12x.
Basically DRYS metrics have improved significantly this year. If the US and China wrap up trade soon, the shipping segment should jump significantly over the next few months and continue moving up from there.
Next up on the horizon are 2 significant factors for shipping: BWTS and low sulfur fuel/scrubbers. The combined equipment installations could easily run several million dollars per ship. This will force ships to be scrapped at a faster pace. This will further push shipping rates higher.
At this pace DRYS will have 10-11 million shares trading by the end of the year. I wonder when brokers will start changing margin requirements to short the shares?
Just guessing, but DRYS net income for 4Q should come in between .20 .25 diluted share. Keeping in mind that Heidmar paid DRYS a $9.7 miillion dividend last year.
I wonder how many shares DRYS is buying back? It doesn't look as though they are having much luck in pushing the pps back into the $4 dollar area.
Spartan - Who knows? If DRYS buys back another 9 million shares, there would be roughly 13 million trading. According to NASDAQ there were ~2.6 million shares short as of 10/31. If those numbers come to pass over the next few months, I suspect brokers will significantly raise the margin requirements which will force many to cover their positions. How high the pps runs would obviously be a factor of how many shares are for sale. If no one is selling, it will cause the bid to run higher still. Could get interesting here...
Here is another observation... The current short interest in DRYS is roughly 12% of the shares being traded. GE hasn't changed his position in DRYS. While his ownership percentage grows as more shares are bought back by DRYS, the same thing is also happening to the short position.
If DRYS buys back another 9 million shares give or take, there will be a lot fewer shares left to cover for shorts. That is making the likelihood of a big run up all the more likely. While GE doesn't appear to be aiming for another RS and there clearly is no need, he does seem to be targeting shorts. Time will tell, of course, but is DRYS headed for another year end run?
According to the latest filing GE now owns 78.3% of DRYS with 92.5 million outstanding. After this new $50 million buyback it makes me wonder how many shares will be in the OS by year end. Considering how the pps was held down during the last buyback, will that happen again or will GE run the pps up and then sell some of his shares for the new, higher average pps?
MM's are playing games this morning: 1 and 5 share lots moving the pps up and down. Let the games continue!
I-Man - While I would normally be looking for that type of pop (and it could happen I suppose), the fact the GE is so much entangled with DRYS keeps the enthusiasm tamped down. I believe DRYS can move forward though especially so into this last quarter and into the new year regardless of GE.
EH - If GE does intend the sell shares from his stash for the $50 million, it would be a good thing in the short term for investors I would think. He would no doubt have the pps run up and keep it there for some time so he could claim he was selling his shares at an average pps over some period. We'll see what happens. My guess is if he is planning that type of shenanigan he'll wait until we get closer to year end. The BDI is normally running pretty hot at that time and the pps will simply track the index.
"We may repurchase shares in privately negotiated or openmarket purchases in accordance with applicable securities laws and regulations..."
Wonder if GE is going to now run the pps up and then sell DRYS a few million shares for the $50 million?
GE bought several ships from himself for $198 million. Transactions will complete before end of the year. $50 million cash set aside to buy back cheap shares. Another ~$200 million will be in the DRYS kitty by the end of the year. Will GET buy more dry bulkers or something else?
And then there is the pesky OSVR fleet rusting away at anchor. Will he be able to get that fleet re-engaged as the offshore drilling industry recovers?
All in though, GE is rebuilding DRYS fleet with ships that are in high demand during a time when that demand is also increasing. Seems that profitability will continue to improve at a time when GE also pans on retiring more shares.
TaxiCaT - Earnings are clearly improving Q over Q and Y over Y. The new buyback isn't much of a surprise considering where the share price is at. Book value is much higher.
I am still wondering what GE is planning to do with all of the cash. As the VLGC's are sold, DRYS should have net cash of about $440 million.
Note 7: (vii) 3 Very Large Gas Carriers
What is the status of the 4th and the overall VLGC sale?
DryShips Inc. Announces Third Quarter 2018 Results Release DateFont size: A | A | A
8:45 AM ET 10/26/18 | GlobeNewswire
DryShips Inc. Announces Third Quarter 2018 Results Release Date
ATHENS, Greece, Oct. 26, 2018 (GLOBE NEWSWIRE) -- DryShips Inc. (NASDAQ:DRYS) (the "Company" or "DryShips"), a diversified owner and operator of ocean going cargo vessels, announced today that it will release its results for the third quarter 2018 after the market closes in New York on Monday, October 29, 2018.
About DryShips Inc.
The Company is a diversified owner and operator of ocean going cargo vessels that operate worldwide. As of October 26, 2018, and not giving effect to any pending vessel transactions, the Company operates a fleet of 30 vessels comprising of (i) 6 Panamax drybulk vessels; (ii) 5 Newcastlemax drybulk vessels; (iii) 5 Kamsarmax drybulk vessels; (iv) 1 Very Large Crude Carrier; (v) 2 Aframax tankers; (vi) 2 Suezmax tanker; (vii) 3 Very Large Gas Carriers; and (viii) 6 Offshore Support Vessels, including 2 Platform Supply and 4 Oil Spill Recovery Vessels.
DryShips' common stock is listed on the NASDAQ Capital Market where it trades under the symbol "DRYS."
Visit the Company's website at www.dryships.com
Forward-Looking Statement
Matters discussed in this press release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with such safe harbor legislation.
Forward-looking statements reflect the Company's current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.
The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in the Company's records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond the Company's control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.
Important factors that, in the Company's view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charter rates, utilization of vessels and vessel values, failure of a seller or shipyard to deliver one or more vessels, failure of a buyer to accept delivery of a vessel, the Company's inability to procure acquisition financing, default by one or more charterers of the Company's ships, changes in demand for drybulk, oil or natural gas commodities, changes in demand that may affect attitudes of time charterers, scheduled and unscheduled drydockings, changes in the Company's voyage and operating expenses, including bunker prices, dry-docking and insurance costs, changes in governmental rules and regulations, changes in the Company's relationships with the lenders under its debt agreements, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents, international hostilities and political events or acts by terrorists.
Risks and uncertainties are further described in reports filed by DryShips with the U.S. Securities and Exchange Commission, including the Company's most recently filed Annual Report on Form 20-F.
Investor Relations / Media:
Nicolas Bornozis
Capital Link, Inc. (New York)
Tel. 212-661-7566
E-mail: dryships@capitallink.com
> Dow Jones Newswires
October 26, 2018 08:45 ET (12:45 GMT)
Still no update on the VLGC sale or stock buyback. Is GE sandbagging investors? Going to surprise everyone (one way or the other) when DRYS reports in a few weeks?
A big spike in $7.50 November call options. Someone is expecting a big spike in price.
VLGC's are getting over $100k per day now and some are predicting $250k is not far off. Too bad GE locked in.
GE had been providing SEC filings for his ownership changes resulting from the buyback on a 2 week cycle. That has changed now, which leads me to assume the buyback is either complete or nearly so. Also, he has remained silent on the VLGC sale and what he intends to do with all of the cash, not just from that sale, but the cash from all of the dealings over the summer. That cash hoard could be as much as $400 million now.
Assuming that last is correct, that's more than $4 in cash value per share never minding the net asset values of the ships. It seems DRYS is significantly undervalued today.
Wonder if we will hear from GE soon. He has been submitted SC 13 D/As every few weeks and he is overdue. Also, no word yet on the VLGC sale and what he plans to do with the cash. People here have floated the idea that he will conduct a buyout and go private. Not so sure, but interesting none the less.
That was fairly unclear. ?
I think GE is withholding information on the VLGC sale until after he completes the buyback.
Expecting to see the end of the $50 million buy back to be completed in the next week or so.
3 months and still no updates on the VLGC sales. Is that going to happen? If so, what is GE planning for all of the cash DRYS will have?
I-Man - I share some of your concerns. However, I directly check the SEC filings frequently and haven't found any new info on the VLGC sales. If you have a link to something announcing the sale, I would appreciate you posting it.
TIA,
Net-Man
Do you have a source for that info? thx
On July 10 DRYS announced the sale of the VLGC's with the transaction due to close during Q3. So what is the status George? Did the sale take place or not? Are you holding off notifying shareholders so you can keep the pps artificially low so you can still buy cheap?