dryships

[Vanraw]

Well I'm wondering if this isn't the beginning of what I was looking for. The news from China is what lifted the shipping guys.

I might jump into Dryships now.

Jaken, dio you know anything about OceanFreight Inc?

http://www.google.com/finance?q=NASDAQ:OCNF

This seems like another good bet once things start to roll.

[Hoofhurr]

I think we're near the bottom. Call it a gut instinct.

[Vanraw]

Were will DRYS go from here? I made a real nice profit on these guys in RL and on the PVP game. Sold both and now back to watching.

I still think that a solid shipping company that is d4ramitlly over sold is a place to make a ton of cash. I'm not sure DRYS is it. It so erratic.

[Jakensama]

The market is going to be crazy volatile for the next year, but there are opportunities in volatility - which is why I am opening up my own shop here in july

Dryships might be more stable than most stocks because it has a substantial offshore drilling component, but the dry market is still going to be hard to read for the remainder of the year. The stock is jumping from what you bought it at but as a long term investment it still aint smart.

[Grieve]

Were will DRYS go from here?

Up! Nice 30% run today, wish I was still in.

[Vanraw]

Were will DRYS go from here?

Up! Nice 30% run today, wish I was still in.

Yea me too. I popped out with a nice profit, but still.

Funny thing about this stock though is tomorrow it will gap down like 10% with no news. Its really odd.

[Jakensama]

They have tied their fate to a lot of other factors than the dry market. Once they got into drilling, I lost a lot of insight on them.,

If you guys are still with this stock give me a PM and I will copy you in on the stuff I get from all the stupid shipping periodicals I have to read all week about them.

[Jakensama]

Some info about Drys in the middle.

Hope blossoms for dry market
A change of mood is in the air and it seems investors are again taking the plunge.


It would be nice to be able to get carried away by the new dry-bulk boom - as welcome a sight as the cherry blossom on the trees this spring.

The Baltic Dry Index (BDI) has been going through a very positive period amid signs that Chinese demand is returning for many commodities and politicians up to and including the US president are openly optimistic about the global economy.

Green shoots of recovery, indeed. Capesize rates are now 10 times what they were in November and a leading dry-bulk operator has been able to raise half-a-billion dollars on the stock market for his group, which logged a $1bn loss in the last quarter of the year.

There has undoutedly been a change of mood around all the markets. Higher-than-expected profits at bellwether US investment bank Goldman Sachs, coupled with a commitment to pay back money borrowed from the US taxpayer, is a very powerful message that the worst of the banking crisis really does appear to be over.

Federal Reserve boss Ben Bernanke was not going overboard but for a central banker to comment on "tentative signs that the sharp decline in economic activity may be slowing" is as close as it comes to blatant optimism.

Key indices such as the Dow Jones STOXX 600 index of large, medium-size and small companies have risen 20% month on month, the oil price has been trending upward and there is a new bounce about Wall Street, albeit that nervousness still abounds.

It was in this atmosphere of renewed investor confidence that Greek shipowner George Economou was able to make his move. "Given the status of the world economy, the fact that we have successfully raised $500m of primary equity is a testament to DryShips's ability to tap the capital markets at any moment in time," he boasted.

Of course, what he did not say is that the 95 million new shares were issued at $5.26 each - and yet this is a company whose stock was worth $116.43 less than 12 months ago.

Investors have had to put up shares diluted four times in value, something that appears to have put DryShips's balance sheet back in some shape but it is not something anyone would do too lightly.

Analysts at Oppenheimer in New York also point out that Economou might have to come back for more money and further dilute the value of shareholdings, as he must decide what to do with $1bn-worth of drilling-rig orders.

In fact, the losses at DryShips have primarily been caused by the decision (grossly unwise, in hindsight) to buy an offshore business, Ocean Rig, at the top of the market. Meanwhile, DryShips's 43-ship fleet, including 29 panamaxes, has been performing relatively well.

Oppenheimer is optimistic about freight rates ahead and predicts that DryShips could see its shares hit $8. Things certainly look brighter with a 36% rise in panamax spot rates last week and further gains in recent days.

Capesize rates have also been up on the back of stronger demand for iron ore from China, as the world's most populous nation benefits from a CNY four trillion ($600bn) economic-stimulus package.

All the signs are far more positive at the moment but no one should get carried away. The bounce-back in freight rates comes from very low levels and the vast majority of listed dry-bulk operators are trading at way below net asset value (NAV).

It is always a bit depressing for management to go into the office in the morning knowing their company would theoretically be worth more if they sold the fleet and went off to play golf in the Algarve. But those green shoots are not just on the fairways or around the roots of cherry trees. There is hope in the air.

[Vanraw]

In your opinion, what do you think is the best stock buy in the dry bulk shipping market?

[Jakensama]

Drys will probably get a fairly solid return here in the next couple months, I haven't watched many of the others. They have their ships on charters that, while not making them rich is at least not hemmorhaging money like many other players.

Most will go the way of the BDI, but drys at least has the offshore drilling part.

[Vanraw]

Cool thanks. Still kicking myself for selling, but hind sight is 20/20.

On a slightly different thread, shiping always knows the economy is getting better before everyone else. This is a good sign I think...

[amins]

Interesting. Totally missed this thread while it was being played out and a guy passed on DRYS to me because I was looking for another good stock to write Covered Calls and dollar cost average down.

I guess the question I have is, would it be better to buy the stock and write the covered calls or buy a LEEP and write the calls, since I don't see them producing quarterly dividends on google/yahoo and the LEEP's would be cheaper?

[amins]

Additionally,

Here are the one's i'm looking at:

EXM
DSX: 95cent dividend? lol

[Vanraw]

FYI I have been playing DRYS cyclical volatility. Buying in the low $6 range and selling close to $7.

This stock is really screwed up, but it seems to be consistently moving up and down in a channel.

[amins]

Good news is it just caught the 200D SMA late last month, and hit it again this week... It's set up for a nice breakout from the Technical side.

I've been slowly accumilating and $cost averaging down.

[Vanraw]

http://www.inthemoneystocks.com/n_rant_a...hp?id=6614

I still own Drys. Keep waiting on the boom in shipping. Perhaps this will be the next one since most of these are guys are still trading at lows.

[Jakensama]

FYI i'd sell before september, we have about a hundred newbuildings coming in the 4th quarter/1st quarter next year and the bulk market is gonna take a hit. I dont know how much of the stock is bulk/dry ships and his new offshore shit, but i am sure it will take a hit then

[Vanraw]

FYI i'd sell before september, we have about a hundred newbuildings coming in the 4th quarter/1st quarter next year and the bulk market is gonna take a hit. I dont know how much of the stock is bulk/dry ships and his new offshore shit, but i am sure it will take a hit then

Thanks Jaken, Whats new buildings? New ships hitting the market?

[Jakensama]

Yup

[Grieve]

I just bought a bunch of DRYS May calls. Baltic dry index surged 6% yesterday. Figure I'd take a gamble for not much money...

[Vanraw]

hah so did I. Its a gamble, but this stock is so cyclical.

[Jakensama]

Get out before Nov/December or don't say I didn't say told you so.

[Grieve]

An analyst on CNBC today said that DRYS is going to $11...certainly gave the stock a nice boost today. I have $7 calls, but they expire in three weeks, so I hope it hurries up getting there.