Aloha PBK - The shelf statement is very clear the number of shares that will be issued whether common or preferred is indeterminate. GE hasn't shown any restraint in printing shares and killing shareholder value in the process. While I believe he will rebuild the fleet and it will operate profitably over the next several years, I don't believe anyone buying and holding will share in that growth.
Assume for a moment that GE brings on ships worth $2 billion adding to the current net value of roughly $380 million. Call it $2.4 billion in net value. The $0.4 billion part of that value required issuing 150 million shares give or take. All things being equal, GE is on a path to issue another 750 million shares or some equivalent to get that next $2 billion. 1 billion shares outstanding decreases the per share value from where it is today which has been lower each month for years.
My fear is that GE will conduct another RS soon to keep the OS at a reasonably low number. This rinse and repeat process will go on for some time to come. The only potential offset could be a real investment with actual money changing hands at a specified price and number of shares. Where GE has given himself the controlling votes and has acted contrary to his fiduciary responsibilities to shareholders, I can't imagine a large investor wanting to get involved with him. Assuming that is the case, it would seem the only path remaining to him at this point is to continue with what has been working for him - print new shares, reverse split, print new shares.
I wish you and everyone else here the best of luck. Personally, I can't make the case for a long-term hold of DRYS. As I have noted recently, this seems to be a day trade only situation and maybe a short if you are disciplined. Unfortunately there are no options to play with on this, which might provide some interesting opportunity and insurance.
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