This is why you buy GNK..Capsize rates are surging..High short..favorable credit facility amendments
27-Nov-12 11:30 ET
Drybulk shipper Star Bulk Carriers (SBLK) is extending yesterday's gains this morning on no news and very thin volume (8.24 +0.45)
Yesterday, SBLK rose 12.2%, but surged as much as 22% on the day. Currently, the stock is up 6% above the $8 area. I'm keeping an eye on this one today... might take a small long position. I say small position given its very thing volume.
I just like the drybulk shippers, which is a beaten space. However, you can't ignore the fact that Capesize shipping rates have increased 347% to $16,357/day in the last 10 weeks. And SBLK does have exposure to this since it owns capesize ships, which consists of half of its fleet.
I am going long GNK
16-Nov-12 11:26 ET
Commodities Trader: Baltic Dry Index rises for sixth consecutive session; Panamax rates surge 22.2% on the week; In the last 3 months, Capesize rates are up 348% -Update
Shipping rates continue to rise, led by huge gains in Panamax drybulk rates this week, as the Baltic Dry Index rose for its sixth consecutive day.
More specifically, Panamax time charter equivalent (aka, shipping rates), rose 22.2% to $7,077/day, outperforming gains in Capesize and Supramax rates. Capesize shipping rates rose 13% to $16,411/day, while Supramax shipping rates rose 4% to $7,046/day.
Of course, companies with exposure to Panamax ships would be viewed as beneficiaries from this notable price increase in rates. Those shipping companies include DRYS, DSX, EXM, GNK, NM, PRGN and SB.
Let's not forget the recent surge in Capesize shipping rates in the last three months, which have risen 348% to $16,411/day. During this same time, Panamax shipping rates only rose 4%
Shipping companies with exposure to both Capesize and Panamax ships include GNK DRYS, DSX, EXM, NM
08-Oct-12 14:17 ET
Commodities Trader: GNK long position Idea (3.62 -0.25) -Update
I'm taking a long position here in dry bulk shipper Genco Shipping & Trading (GNK) following today's weakness and plan on holding this for a swing trade, not a scalp trade here. The stock is currently two cents above its LoD of $3.60. Risking $0.25.
Some real momemtum began in GNK on August 2, 2012. On August 1, the stock close at $2.09. On August 1 after the close, the co reported earnings results.
However, it wasn't the earnings results that made the stock move higher the next trading day. It was favorable credit facility amendments that propelled the stock higher. So on August 2, GNK surged 44% higher to close to $3.00/share. Those gains were extended the next day as GNK rose another 24% to $3.73 (stock rallied 78.5% higher during those two days).
This is a sustainable catalyst and is something that makes me interested in buying some shares, especially on any decent pullback and when capesize rates are surging as they have in recent trading days.