This is nothing more than a Classic Dividend Trap ~ Believe me, I'm still caught in several of them since the '08-'09 crash to the tune of 6 figure paper losses...Your loss in DCIX pps will not be made up in the form of dividend payments (since, after all, the stock price is cut by the amount of the dividend to be paid anyway ~ rates are not escalating)...Shipping is the S.hytes right now, has been for years but it could turn the corner in a year or two ~ This could be a buy in a year or two don't get me wrong but I think you can get it at a lot lower price and on the upswing, not the downswing...Buy shippers when the price is going up, not when its going down...
The Street values DCIX at $3.66 OR .96c for EVERY .15c of dividend DCIX pays ~ If the dividend is cut in half do you still believe the pps will remain in the mid to upper $3 range and go higher...?...If you do then I've got some swamp land in FL I'd like to sell you ~ Be very careful here and new money should avoid this sector altogether... imho!
In my opinion, your arguments are not very convincing. Basically, you say that DCIX will go down (i.e. even lower than current level) because you had bad experience with other dividend stocks 5-6 years ago. Were it dry-bulk shipping stock from 2008-9, by the way?
It is always possible to make more stock-specific points. For example, those high-dividend dry-bulk shippers (EXM, EGLE, etc) suffered from over-extending balance sheet (taking huge debt) at the start of very long bear market, and it caught up with them 3-4 years later. It would require very strong conviction to say that containership market should expect 3-4 bear market ahead. Also, DCIX balance sheet (liquidity) situation does not look too bad; it is supported by DSX liquidity and it is something that you should know (again in case you were invested in dry-bulkers).
So far, DCIX charters look good, obviously if purchasing price and/or age of ships is ignored. Dividend is well supported at current level and any uptick in containership rates and/or any sign of the end in “cascade” could bring material improvement to stock price. In other words, worst-case scenario seems to be remote here, while potential is still around.