Perhaps I was too brief when said about LPs. I meant next paragraph from 424b:
"We estimate that if you hold common shares that you purchase in this offering through the period ending December 31, 2008, the distributions you receive, on a cumulative basis, that will constitute dividends for U.S. federal income tax purposes will be less than 20% of the total cash distributions you receive for that period. For example, if you receive an annual distribution of $1.70 per share during this period, we estimate that no more than $0.34 of such amount will constitute dividends, which will be taxable as �qualified dividend income� if you meet the eligibility requirements. Please read �United States Tax Considerations�United States Federal Income Taxation of U.S. Holders�Ratio of Dividend Income to Distributions� for the basis for this estimate. Please read �United States Tax Considerations�United States Federal Income Taxation of U.S. Holders�Distributions� for information regarding the eligibility requirements for the receipt of �qualified dividend income.�
Looks like they have a dividends which will be
85-90% ROC for the long period. This is what I meant that they "are LP". But I am looking into it now.
Sorry for the confusion.
Yep, I agree, but it is LP - I am looking at it one now, but not very confident with LPs.
One big plus - they have a good connections to Washington's family... Will do further analysis and update my post :)
"However, the 4th quarter yield of 11% at todays close is not the end of the world. My blended yield, including the others previously mentioned is over 12%"
I would like draw you attention to three financing companies:
SFL - leases from FRO
DHT - leases from OSG
ATB - leases from Stena AB.
They have 10% yield (ATB will have it after fleet expansion - $2.19/share dividend annually)
ALl charters are out beyond 2009-2011, and in ATB case fleet is very new - 2001-2005. (new Stena Contest and Stena Concept are 2005 yr build). Stena has an options to continue the charters for up to 5 years after 2009.
I am considering this as a very good opportunity to diversify out of spot traders and medium term charters like DRYS DSX. 10% yield is not bad either...
Hope it helps.
Actually, I have diversified my income portfolio to include the dry bulkers; EGLE,DSX, QMAR and GSTL. I included DSX BECAUSE of the ST charter strategy. It seemed like a good hedge against the others, who have embraced the LT charter model.
I stated in an earlier post that I felt DIANA stumbled by issuing more shares when they could not support the current dividend. The Naked shorts and others have had a field day. The stock has been rightly punished, because in my opinion, most investors are looking for stable income. Diana's divy is not stable. DSX should have waited to lock in long term rates and in the meantime stayed out of the equity market. The purchases could have remained on the revolver until a more favorable time. It disturbes me that the fleet additions only added 2 cents per quarter. That was not worth the move from aprox $15.5 to below $13.
However, the 4th quarter yield of 11% at todays close is not the end of the world. My blended yield, including the others previously mentioned is over 12%.
"The trend is your friend," until the trend ends. You state that this is the time of year that rates are peaking. Well, how do you know that they won't trend higher next quarter? Is your crystal ball better that mine? How so?
I would be concerned if globalization ended, countries instituted protectionist laws etc. Or if China, India and now Japan roll over and fall into a ressession. Do you see that happening next year?
I see the dry bulkers as a way to play the international transportation business at a time when our trading partners are experiencing tremendous growth. Owning a diversified portfolio of the divy payers including DSX is my way of capturing that growth.
Thank you Vladimir for posting the prospectus. Under the stated dividend policy the management announced the range of this quarters dividend to be between $.34 and $.36. They go on to say that had the additions to the fleet were included then the rate per share would be increased by 6.5% of the midpoint, or another $.02. The date of the prospectus was December 6th, so the estimate is pretty fresh, with not a whole lot of wiggle until year end. This represents an 11% yield, on todays close. Certainly not what most had hoped but still not shabby.
I'm surprised Audio that you would take the time to post old fleet deployment numbers. I read your posts on other boards and repect your opinion. However, why not post the actual fleet deployment off the Diana web site which is updated as of today?
If Diana has stated the quarter will be between .34 and .36 and that the additions will add .02 next quarter, then until they prove themselves wrong, I'll believe them.