I've been in and out of GNK for a while, I have no position as of yet, but I see a lot of discussion on when is the right time to buy. Overall, I like GNK's management and think they have done a great job taking advantage of the this down turn in buying ships which should provide share holder value long term... I'd love to see $3 though, I really tempted to buy at these levels... Hard to believe that I used to trade this stock in the 20s... Long term, I think this could be very lucrative investment assuming they can navigate these trouble waters short term. It is hard to believe it is in the high $3 now...
Here is some recent interesting thoughts from a morning star analyst regarding 2012 though.
Morningstar Analyst 5/9/2012
Oversupply has kept dry-bulk shippers in the brig, and it will take some time before they are squared away. Strong demand for the dry-bulk trade continues to be fully offset by available capacity in the existing world fleet. Despite record-breaking scrapping rates and elevated slippage rates, oversupply is expected to keep a lid on freight rates for all of 2012. When the Baltic Dry Index--which measures shipping demand versus supply--reached a 25-year low Feb. 3, some industry participants called for a bottom. However, we think headwinds will weigh heavily for some time, and we would delay investment in this market until the order book trims down and the rate of new orders weakens. We think this is likely to occur in late 2012, at the earliest, or early 2013.
Audio--You don't have that information about their purchases correct or you are intentionally misstating it. Here is the real info.
"Depending on market conditions, we intend to acquire additional modern, high-quality drybulk carriers through timely and selective acquisitions of vessels in a manner that is accretive to our cash flow. In connection with the acquisitions made during 2007 through 2011 and our growth strategy, we negotiated the 2007 Credit Facility, $100 Million Term Loan Facility, $253 Million Term Loan Facility and the 2010 Baltic Trading Credit Facility (each as defined herein) that we have used to acquire vessels. We expect to fund acquisitions of additional vessels using cash reserves set aside for this purpose or additional borrowings and may consider additional debt or equity financing alternatives from time to time.
On June 3, 2010, we entered into an agreement to purchase a total of eight Handysize drybulk vessels, including five newbuildings, from companies within the Metrostar Management Corporation group of companies (“Metrostar”) for an aggregate purchase price of $266.0 million. Five of these vessels are owned by us and three are owned by Baltic Trading. Additionally, on June 24, 2010, we entered into a Master Agreement with Bourbon SA (“Bourbon”) to purchase 16 drybulk vessels, including two newbuildings, for an aggregate purchase price of $545.0 million. We retained 13 of the 16 vessels, including one newbuilding, and the remaining three vessels were immediately resold to Maritime Equity Partners LLC (“MEP”), a company managed by a Company owned by our Chairman, Peter C. Georgiopoulos. All eight vessels have been delivered from Metrostar and all 16 vessels have been delivered from Bourbon, three of which were sold to MEP.
In order to fund the acquisition of these vessels, we entered into two senior secured term loan facilities. On August 12, 2010, we entered into a $100 million senior secured term loan facility (the “$100 Million Term Loan Facility”) to be utilized to fund or refund to us a portion of the purchase price of the acquisition of five vessels from Metrostar. On August 20, 2010, we entered into a $253 million senior secured term loan facility (the “$253 Million Term Loan Facility”) to fund a portion of the purchase price of the acquisition of 13 vessels from Bourbon. The Baltic Trading vessels have been funded utilizing its $150 million senior secured revolving credit facility (the “2010 Baltic Trading Credit Facility”).