During the tech crash of 2000, I was looking at 2 tech stocks: RIMM and LVLT. RIMM (split adjusted) went from 25 to 1. LVLT went from 130-2. Fast forward and LVLT is at as bout 1 and RIMM is 55. Point is that all companies within a sector are not created equal. I just bought some exm, so I am not saying that EXM fits either class, but please be cautious when investing in individual stocks in this sector. It seems that a major shakeout is about to occur. Even though I believe that the dry bulk sector will survive and thrive (just like the tech sector), there will be winners and losers. Do your homework and don't buy just some random stock in the sector expecting it to rally with the rest. All the best.
Isn't that the point. I looked at the numbers and the company seems to have a great deal of debt. We are talking about making a lot of money based on debt (owed on assets, the boats), right? How are the bonds doing? Any body know?
You may probably know that according to the famous Dow Jone's theory, transport sector is a leading indicator of market trends. Strange it may look but the carnage in the shipping sector actually preceded the steep fall in all the indices which we have seen lately. If you believe the shipping sector has not bottomed yet, then you can expect the markets to continue to fall in the coming days and weeks. What it means is a serious loss of wealth for people all over the world. So pray that the shipping stocks and other transportation stocks will see a definite reversal in the near future so that the entire market will begin to see reversal a few weeks later.
Also, according to the phases of business cycle, technology sector ususally peaks when the economy is in the peak stage (we have seen the economy peaking in 2006-2007 when the four horsemen were on the rampage) where as commodities and transport stocks rise when the economy begins to heat up, right after a recession and they continue to rise till inflation becomes an issue. We have seen this happening in commodities between 2003 and 2008 when companies like AKS, ZEUS shot up from single digits to 70s and 80s.. So by all means the shipping and transport stocks will be the first to catch momentum when the business cycle begins to see the ascending curve.