Great management, but the industry fundamentals are awful. I became afraid that even with the company doing everything right, we would not see a rebound for years because of vessel oversupply.
Other companies might go bankrupt, but those ships will still be in the water and will hold down rates for years. NM might have to compete with restructured companies that have very little debt after bankruptcy.
Sold over 60,000 shares today. Good luck to everyone.
One day before your bail-out, you posted with the heading "People Still Feel Good About NM Long-term?" I can see now that was a cry for help. Clearly, an intervention was called for. But we never heard you...sigh. : )
Guru, your reason for exiting is the sole caution i keep revisiting in my head. my understanding, though, is under British admiralty law, even if a company goes thru reorg of some sort the terms of charter still hold and whoever ends up with the ships... bondholders? banks?... still must perform. the bk'd line doesn't get to keep its pledged ships. do you understand that differently??
also, with deliveries in DB fairly small in 2013 and scrapping at 31mmt or more this year, if we see sustained numbers out of China, don't you feel supply/demand could tighten rather quickly... maybe by end of Q2?? i guess not, but that is my thinking as i stay long a larger position.
The DB side of NM is going to be pretty long in the teeth before it rebounds, yes. That's why NM is suffering. It has major stakes in NNA and NSALI and has management that can make shrewd moves in tough times and has the benefit of cash and good cred, so though amking $ in DB could take more time than I'll bother trying to estimate, when it's oversold it's still a buy and when it's doing better I still want to maintain a holding because I see it as solid over the longer term and never know when AF will finally find 'the' wave to jump on - some fleet purchase that turns out to be precient. I never can tell when someone talks sharecount if they're making it up, but if you sold 60k shares today that's a notable move. Appreciate your comments. I hold a good deal more NNA than NM, and have steered clear of NMM generally. While back I called 4 'lofty' for NM, still remember that when it starts going up there: it keeps coming back down so trades have paid off...
I really like the company, but I keep hearing that the supply of ships is still going to be huge next year, on top of the current oversupply. So I am hearing more and more that a recovery might not be until 2015 at the earliest. Some people are beginning to say that it might take a decade for this thing to clear up. That just plains scares me, because no matter how good NM is managed, the ships from bankrupt companies will still be in the water, which will depress rates for a long time.
I am also afraid that just like in the airline industry, bankrupt companies, or new participants that buy ships on the cheap, will have an advantage over the companies that are well managed like NM, since they will not carry the debt that the survivors will have. This will give them an unfair advantage.
I did not do this lightly, I help for about 4 years. I just don't want to see the stock drift lower and lower as the company posts losses for at least 2 years. The estimates for next year already show a loss. While the insurance restructure provides some funds, that will not last if this industry keeps sinking.
Again, great management, but the supply of ships might sink everybody.