Sat, Jan 31, 2015, 11:30 AM EST - U.S. Markets closed


% | $
Quotes you view appear here for quick access.

DryShips, Inc. Message Board

  • mokos2 mokos2 Dec 16, 2010 12:51 AM Flag


    Lazards Capital Markets' Urs Dur has a “Buy” rating on Dryships and an $11 price target. Formerly Urs Dur was a shipping broker and he is the most accurate analyst covering DRYS.

    DRYS did a private placement for 20% of their UDW unit, "Ocean Rig", raising half a billion dollars.

    A condition of that private placement is for DRYS to spin off, in an IPO, the Ocean Rig division. The math is simple: half a billion for 20%, x5, = 2.5 billion.

    This isn't "maybe"; it is contractually stipulated in the Private Placement prospectus, with the PP going at $17.50 and the balance 80% of DRYS' Ocean Rig division to be IPO in the first half of 2011.

    This give you a market value for the Ocean Rig IPO of 2.5 billion dollars -- more than the total market cap for Drys' Dryships.

    Which gives you a $12.00 price target.

    Note that Goldman Sachs predict that the BDI will average 2,500 for 2011. That is +25% above where it is now.

    Note too that DRYS has presold charters for 82% of it's Dryships for nearly double the current spot. That leaves only 18% of the Dryships revenue open to spot. Thus, if the BDI goes down 10%, the real impact on DRYS is contained to the unchartered Dryships, just 1.8%.

    The contractually mandated Drillships IPO doubles DRYS market cap. That's $12-$18/share.

    So naturally, gliding into Friday's Witch there's turbulence, but the upside is so baked into the cake that it's FUBARing the volatility the options marketeers pine for.

    Pete Najarian & Brian Kelly can be mocked; but they're right because these facts are publcily provided and the math is the math.

    See you at $12-$18

    $50 call options for January is just outright interesting.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
0.93+0.0328(+3.66%)Jan 30 3:59 PMEST

Trending Tickers

Trending Tickers features significant U.S. stocks showing the most dramatic increase in user interest in Yahoo Finance in the previous hour over historic norms. The list is limited to those equities which trade at least 100,000 shares on an average day and have a market cap of more than $300 million.