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I wonder how many shares DRYS has bought back? The $50 million could scoop up half the float at these prices.
DGAS value alone is at least what DRYS is trading for now. That underscores that the market isn't giving any value to the remaining ships at the moment.
New company to be listed with symbol DGAS. DRYS will continue to hold 51% ownership in spin off.
DRYS filed to spinoff the gas carriers.
DRYS could have already completed their purchase of shares at the market over the past few weeks. Is it possible they purchased half of the float? How many shares are actually available?
TaxiCaT - $50 million stock repurchase sounds like 10-12 million shares will be parked as treasury shares and removed from the float. 20 million shares in the float afterwards. 90 million shares in the OS brings DRYS book value up a good deal too. $8.50 or so is my guess at the moment.
Now ask yourself why GE is doing this?
Bargain basement prices here and the shorts are still trying to move the pps lower. The current valuation for DRYS is roughly 40% of book value. Seems like a buying opportunity to me.
BDI will trade within a range until after the Chinese New Year ends next month. FF contracts will start moving higher probably as early as next week certainly in Feb. Used ships are selling at higher values while new construction is limited. Scrapping has slowed and the cash price being paid has moved up a surprising amount. Worldwide GDP is moving up.
Throw into all of this BWTS and sulfur emission regs by the IMO and towards the end of this year, scrapping will pick up due to the costs of remediation efforts versus ship valuation.
My guess is spot/charter rates will be higher each quarter this year. 2019 could be a huge year of shippers if the fleet remains at current levels or smaller.
DRYS, at least for now, will move higher but continue to be constrained by the GE effect.
Spot rates are likely to stay within a small range for the next month. The Chinese New Year will be a factor for the end of February, which will all but stop shipping into China. Once that holiday ends though, rates should move up and my guess is quickly. By end of 2Q shipping stock prices will be moving up fast. DRYS included. Right now seems to be a really good entry point.
Sam - Well maybe. Hopefully the project isn't another in a very long string of Nigerian "oil ministry" styled scams.
Sam - Not that I am aware of. How would a KDS be used in the project?
Is there any reason to believe the SEC hasn't already concluded their review?
I-Man - I suspect it may take another quarter or 2 before pps/sentiment catches up where DRYS is at currently. The other wild card in this, of course, is GE. A lot of wild talk about what he will do once his shares are unlocked. If we know nothing else about the man is that he is self-serving. So to think he will do anything but make his shares more valuable, and by extension other shareholders as well, seems a bit silly to me.
Throw into the calculation an improving worldwide economy and increasing shipping rates, and DRYS seems destined to move higher. Rates will begin improving once the Chinese New Year is over. That and weather are the primary reasons for current rates, which have been a well established factor in the rate cycle. February on should look pretty good.
Sentiment is beginning to shift. 2017 was likely the pivot point where demand began to catch up with supply of ships. The order book has remained low for most classes of ships. The wild card will be how much scrapping will occur during 2018 and beyond. The looming sulfur and BWTS regs will no doubt will make many ships non-economical and see those ships sold off for scrap. I am guessing this will start in earnest late 3Q this year and continue into 2019.
With demand pressures and reduced supply, rates will continue rising this spring and surge in the third and fourth quarters. Investors reducing their shorts is a good sign. Watch for DRYS earnings next month and the pps run up to earnings.
http://www.hellenicshippingnews.com/shipping-commodities-trade-trends-a-sign-of-positive-things-to-come/
Historically 1Q is the low point for shipping rates. Look for things to slowly start advancing though as we move through the quarter.
I-Man - The shipping cycle is more likely the reason for low volume right now. DRYS does have debt on some their vessels and several ships are chartered out for spot rates. With that said, DRYS is a different operation than what it was just last year and the company does seem on the path to provide positive revenues. GE very definitely will have a negative impact on the pps going forward - at least for a while. People will always focus on the future prospects of a company, which is exactly why GE has been able to RS so many times since DRYS was formed.
Do you have a source for this? No SEC filings or news found. Sounds like something a short would say without any confirmation.
That should have read $10 mm per quarter for the VLGC gross profit.
The 4 VLGC's are producing ~$40 mm in gross profit each quarter.
Sam - more than 1 share has traded since delisting. I think what we all want though is to have the shares trading on a public market.
BDI up 1371
MM showed a 1 share trade to take the pps down. I also notice the trade isn't on level 2 a few minutes later. Not too much manipulation going on!!!
Oops. Wrong board! Happy New Year everyone. FASC's time is coming albeit slower than expected. Stay tuned!!!!
Talk about MM manipulation. 1 share traded to take the pps down.
4Q earnings will likely be out late February. The pps might begin trending higher going in to earnings. 1Q 2018 earnings will be lower though as first quarter in shipping is typically overall lower.
My guess is the $125 mm was in part to pay for the latest VLGC. That would leave DRYS with something around $85=$90 mm left between cash and available credit. The next question would be what is GE planning for the balance?
I am also wondering what he will do with the OSVR fleet? Maybe a swap of the fleet for some part of the new ORIG? Those ships are collecting barnacles today so anything GE did with them, as long as it benefits shareholders, would be a good thing.
Keep in mind DRYS is still trading at roughly half ship book value. Earnings will no doubt be significantly better in 2018 and provide a basis for a pe multiple. Both value and earnings will be factors in driving the pps up from here. WBTS and sulfur regs will take more ships out of the fleet given the cost. So over the next 12-18 months spot rates should move up accordingly and substantially improve earnings and ship values. My guess is DRYS and other shippers are on a good track at this point.
Buy on the rumor and sell on the news. The pps dropped as soon as the news came out this morning.
The 4 VLGC's will produce over $10mm in gross revenue per quarter. Pretty much guaranteed given who they are contracted out to.
Happy new year everyone! Sam - the Canadian project is still moving forward, albeit at a too slow pace. There other projects sprinkled around the globe that have been held up pending closure on the Canadian project too. Still expecting something to break shortly.
1Q is always a bit slow in shipping. BDi will bump around a bit. Waiting to see if the long line of ships in queue in Queensland and Qingdao shortens up very much this month. There has been a 3-4 week waiting period to be loaded or unloaded for iron ore. Coal may also become a factor if the northern hemisphere weather stays cold for much longer.
BDI was 428 or so this time last year. Considering it is 1366 today, I would say there has been significant improvement. Still, a long ways to go to get back to average of roughly 2400.
Mont Gele (#4 VLGC) listed as underway for sea trials. The ship would seem to be on track for delivery this month.
DRYS has access to $125mm in new lines of credit. wonder f GE plans to expand the fleet beyond the new VLGC this month?
TA - I see your confusion now. You are looking at the column reporting 2016. The 3Q 2017 shareholder's equity number was reported at $607mm or roughly $6/share.
I have read all of the filings and don't understand any math that would get BV to $1 or below. Perhaps you could point out specific sections in any of the filings that would help make your case?
Book value below $1? You will have to help me understand your math. It looks a bit closer to $7 to me.
I was happy to see GE off load one of the older Panamax. Hoping that is setting the stage to get rid of 7 more of the pre-2005 ships. With the looming BWTS and sulfur rules, these older ships are not economical. He has a year or so to sell those ships and get a good price. If he can get $65-$70 million for the ships and combine that with the $125mm loans, that would replace the ships sold.
Commitments from 2 lenders for aggregate $125 million secured credit and sale of 2001 Panamax for $8.5 million by unaffiliated buyer
News out PM.