Looks like the panic selling may be over for now. Look at the charts. The volume has curtailed the last two days. The stock is now sitting at weak support around $3 with a new band of major resistance overhead now in the $4-$4.50 range. Then there is more resistance around $5 and another band of major resistance between $5.50 and $6. Yes, it's very oversold here and, barring more bad news out of the Euro zone, it will probably bounce somewhat, but without any significant buying, which I don't foresee, there is little to no chance this thing will trade significantly above $5 for a while (2 years?). There is also still a strong chance that on weak volume with no buyers, EXM will simply drift down through the week support at $3 and then experience another round of panic selling into the 1's on the first sign of bad news like another round of Euro zone defaults or a EXM bad quarter.
Anyone that thinks this stock will shoot up into the $10's any time in the next two years is simply delusional. I'm not even sure it will even exist in 2 years. For the next 2 years, this is a high risk investment with very little upside. If you're in it and want to stick it out, that's your choice, but at least have the sense to put the mindless pumping aside and own up to the fact that you are deep underwater in your position. I'm not buying anybody's BS about loading up with shares at $3. You may be averaging down at $3, although I doubt you even have any cash left to do that.
If you think you have a better read, post it. And I don't mean "Hey, dude, this thing is going to the moon! Yozwah!" Post something substantial based on the charts or financials. No more of this ridiculous PE/Book value stuff. Yes, you can quote a trailing PE and cry it's undervalued, but that's BS. This thing is NOT undervalued and you should be concerned about the forward PE, not the trailing PE. This company will post a loss for 2011 and probably 2012 too. After that? Who knows? They may run out of cash.
I'll debate the facts with anyone here. Let's start with this. Why is the forward PE for EXM is listed as NA on Yahoo? Anybody? Bueller? Why is this bad? Does anyone here have a clue?
They generally slow down on the ballast legs only or when the contract allows for delivery at specific times that allow for slow steaming such as COAs. So with the capes averageing about 11 knots for the fleet, the ballast legs are really crawling.
The BRS public site doesn't update regularly, so I registered, for free.
THAT site is updated each Monday PM.
Their 4 pages report the fleet counts as well as the order bank.
Delivery counts sometimes differ from the public site.
Anyway, I have been posting this info to a spreadsheet, weekly.
With this, I can see the weekly and YTD changes.
I calc scrapping as the fleet change after adding deliveries.
BRS seems to be slow in recognizing scrapped ships.
When they slow the vessels, who pays for the additional voyage days?
There would be fuel savings.
Do they offset?
I did not notice the changes. Their reports are so infrequent and updated seemingly at random that I don't bother reading them very often.
The Japanese yards were not affected much by the disaster, they are very far away from the epicenter and tsunami landfall area.
In even a good year, 10% of orders get cancelled.
I get about 100 or so scrapped, but that counts many small vessels under 20k. The newbuilds are on average 20% larger.
Shifting orders out to 2013 is to be expected and may give the industry a bit more time to get their "house" in order. We'll see. They are eating through the older Capes pretty fast. And they are slowing down the vessels at sea. Average speeds now around 10 knots. Can't go much slower.
I understand what you are saying here, but it is overly pessimistic.
No matter what the news, the IMF and EU will not let Greece default. You see it playing out now. They will continue to prop up poor Eurozone debt until the economy recovers.
There is a glut of ships yes, but I am not seeing drastic under utilization being reported. Industry wide, 40% of the expected newbuilds coming online with 60% cancellations or deferrals now.
China and Japan will help this stock and will help moderate excess dry bulk ship supply. EXM has good exposure to spot rates, which will help increase income when demand rises. They are hurt by that exposure now, but should see a windfall of sorts when spot rates see a spike. Next couple quarters this is expected. It will take years to rebuild Japan, and China is growing year OVER year.
Pressure over the next couple years yes. But these global factors will help mitigate that pressure.
You think this stock will plummet as low as the NAV? LOL. You are a fool. Sorry. If you are that confident you should short the stock.
I find beaten down value stocks with expected upside, that's how I grow my portfolio. Haven't been burnt yet. We will see great upside here 6 - 12 out.
You rant and rave about people investing in a beaten stock. Buy low, sell high is what it is all about. EXM is not going under. Things will still need to be shipped, and this is not one of the players that will sink.
$3 a share you should join us! Wait... it's more like $3.20 now... hehehe
"I understand what you are saying here, but it is overly pessimistic."
Well, maybe a little, but I find that being a bit of a pessimist saves me from a lot of grief.
"No matter what the news, the IMF and EU will not let Greece default."
I agree. They can't. If they do, they will see the same thing happen that happened to the wall street banks. One domino after another until. The bad news, however, is that this crisis is going to tighten credit in the Euro zone and this WILL stiffle growth and ultimately affect the shipping industry.
"I am not seeing drastic under utilization being reported."
It depends on your definition of drastic, I suppose, it's not the important thing anyway. Growth and margin drive stock price and with ANY kind of glut, both will be suppressed. Without growth, no stock is going to appreciate significantly in value.
"Next couple quarters this is expected. It will take years to rebuild Japan, and China is growing year OVER year."
I don't think the growth is what you think it is. Japan is in big trouble. They made some mistakes in their own credit markets that they are still paying for. The recovery from the tsunami is not going to be quick and Japan was reporting bad economic data long before the disaster. You should read the Fed report on Japan. Look where their economy was heading before the tsunami.
As for China, they are not going to be caught flat footed again. They already are a heavyweight in terms of ship building and they will be a heavyweight in terms of shipping as well. We are unlikely to see Chinese demand having the same kind of pressure on shipping rates that it did in 2007-2008. And don't underestimate the effect that Chinese currency games are having.
"You think this stock will plummet as low as the NAV? LOL. You are a fool. Sorry. If you are that confident you should short the stock."
I told you it had support at $3 and that it would probably bounce from there. Pretty good chart reading for a fool, I'd say. As I said before, it might even bounce as high as the 5's over the next 6-18 months, but I am confident it won't move much higher than that and I am not at all confident it won't still break $3 and head for the $1's. If they miss their earnings or, worse, they or analysts revise guidance down, I am certain it will drop more. Will that happen? I don't know, I just know it's high risk. Even if it doesn't happen EXM will struggle in the $4's where there is major resistance. The only thing that will change all this is surprises to the upside: a big contract, better earnings, favorable refinancing, etc.
"We will see great upside here 6 - 12 out."
IMHO, way too soon. No great upside here in 6-12. $5 maybe. higher than that, no way.
"EXM is not going under. Things will still need to be shipped, and this is not one of the players that will sink."
How do you know? I heard same thing about MCI and Enron. People still need phone service and power, right? Look, I am talking to you respectfully because you (kind of) want to actually have a rational debate, but I know people who have lost $100,000's on stocks because they said these very words.
"$3 a share you should join us! Wait... it's more like $3.20 now"
Don't need to. I never seem to have trouble finding good investment by just being patient. And no, I am not going to short a $3 stock. My broker wouldn't let me anyway, would yours?
More 'Bands of Resistance' - lol. You sound like a Zack's sycophant. People who trade based solely on trends or 'expected resistance' without looking at global factors or fundamentals are idiots.
Cut to the chase - dry shippers of varying leveraged debt will all be under pressure until the BDI picks up. The more leveraged the more pressure - goes without saying if liquidity is low. The BDI is slowly scraping back upward.
Japan and increased Chinese demand are looming. China needs more power plants, infrastructure and more coal. Once the government stops dickering about with itself trying to reign in inflation- they should hit the throttle full blast again.
The sector may not recover to pre-2008 levels, but should recover very nicely. Prices are rock bottom now, I don't see EXM as having a 'going concern'. It isn't rocket science - BUY BUY BUY $3 A SHARE! You hit $5, (and it will hit $5 6-12 months out) - 66% return ;-)
Once the BDI rises, demand increases - bigger players will buy in. You'll note the 'Trend' ofc lol
"More 'Bands of Resistance' - lol."
I'm sure it seems like magic to you since the only bands of resistance you art familiar with are on your Hanes support briefs.
"Cut to the chase - dry shippers of varying leveraged debt will all be under pressure until the BDI picks up."
Boy, are you insightful. You're right. The world economy has nothing to do with it. There is absolutely no relationship between the BDI and economic issues. And if the world economy stays suppressed for several more years, there is no reason to be concerned about the gluts of ships or cash burn, right?
"Japan and increased Chinese demand are looming. China needs more power plants, infrastructure and more coal. Once the government stops dickering about with itself trying to reign in inflation- they should hit the throttle full blast again."
Wow! Did you learn that Nickelodean's "Economics for Kids?" So the only economic problem in the world today is that "the government" is "dickering about .. trying to reign in inflation?" Gosh, you sound really informed. I would love to learn from you. Could you post the research behind your statement that "Japan and increased Chinese demand are looming" I'm sure you have it right in front of you.
"BUY BUY BUY $3 A SHARE! You hit $5, (and it will hit $5 6-12 months out) - 66% return ;-)"
Right. So you don't own any shares bought above $5, right? And you haven't received a margin call on your position, right? Of course.