Here is part of the problem: NMM business revenue is partially generated in foreign currencies. However, repayment of any existing USA corporate debt is in US dollars against a 23 percent rise in currency exchange rates. The USA dollar is getting much stronger.
The market perception may be worse than the reality. Just my take on it.
Excellent advice. There are so many factors in the world markets, including monetary exchange rates , that caution is simply prudent.
If you believe that this company is going bankrupt, one should get out now!
On the other hand, here is the woman at the helm. From her history, and my holding experience, I'm of the view that it's a time to consider bulking up at bargain values..
"In 2004, Frangou raised $200 million to buy Navios. Previously she was working on Wall St as an analyst on the trading floor of Republic National Bank for a couple of years. As of December 2014, Navios Group controls 149 dry bulk carriers, 50 tankers and 12 container vessels. Between 2004- 2014, "the Navios group has raised a shade under $10bn in financing - $6.3bn from the capital markets and 3.6bn from bank debt". Angeliki Frangou demostrates an acute ability to grasp both the financial and shipping markets. "She is just as happy to mull over the fuel economies that can be achieved by proper sandblasting as she is to discuss the intricacies of financial tools". Being a woman in a male dominated industry does not seem to pose an issue for her. Asked about the role of women in top posts in shipping, she retorted that "I don't believe in gender, race, religion. I think it's what you want to make it. If you ever thought that you work in a company for any other reason than your ability, you should leave!"
If the books are cooked or the CEO is not truthful, then we’re in deep trouble. Share prices are headed to 2008-2009 levels and NMM paid dividends during those dark days when many companies lowered or discontinued paying dividends. They have not missed a dividend in more than seven years.
One might believe the downward stock price is connected with the decline of Oils, Exxon and others, in combination with the Euro and financial problems in Greece. I have no clue.
My point is this:
This stock (units) was selling at more than $20 per during August 2014. That would have been the time to market additional units rather than at $13. They missed the "high". Is that not true?
It's evident they messed-up on finance timing..
Did they mess-up on financing?
Understanding the historic pattern of the unit price range, why would they not issue additional shares at $17 or 18, rather than $13? Or did they not foresee the price side and need added cash for prior commitments?
The next scheduled dividend payment should be during February. If the payment is equal to $0.80 per share annualized, a reduction of a about one half of the past, the dividend return will still be 20 percent at a per share price of $4.00. That seems an acceptable level of risk considering that natural gas, not oil, produces a significant portion of the revenue into the Trust.
We built, paid for the Panama Canal, paid leases, built supporting facilities. Jimmy Carter and his Congress gave it away for no good reason. Now China has legal right to status in Nicaragua and has personnel, perhaps "Advisors" working in Panama.
The USA is flat footed with no control over either canal (potential canal) and the need for two ocean military protection extending beyond Hawaii. Go figure .
It has a favorable track record, at least so far. I cannot locate serious management investment mistakes. I would add at $17, or lower.
These people see value with SDR
Top Institutional Holders
Holder, Shares, % Out, Value*
Morgan Stanley 379,582 $ 1.02 3,048,043 Jun 30, 2014
AMG National Trust Bank 130,801 0.35 1,050,332 Jun 30, 2014
Royal Bank of Canada 96,905 0.26 778,147 Jun 30, 2014
CALPERS (California-Public Employees Retirement System) 70,800 0.19 568,524 Jun 30, 2014
Segall Bryant & Hamill Investment Counsel 69,227 0.19 555,892 Jun 30, 2014
Veritable, LP 50,000 0.13 401,500 Jun 30, 2014
Credit Suisse/ 43,571 0.12 349,875 Jun 30, 2014
Pennsylvania Trust Company 36,000 0.10 289,080 Jun 30, 2014
Group One Trading, L.P. 28,000 0.08 224,840 Jun 30, 2014
uotient Investors, LLC 22,400 0.06 179,872 Jun 30, 2014
You are playing with half a deck. Of the 49,725,000 shares authorized only 26,000,000 have been offered, or about 52 percent. Who knows when the other shoe will drop, or the market effect of more shares offered?
They have paid dividends since the mid 1990's, not sure about prior to that. This company has been around, growing for more than 50 years. That speaks for itself. The price of the stock is at a 5 year low. Seems most folks prefer to buy when prices are at all time highs, unlike wheat, barley or Levis!.
Well now, we all have "limited lifetimes" even when the limit is not determined as is SDR's. It's all in knowing when to hold 'em, when to fold 'em. Think: Enron!
I see Royal Bank of Canada recently collected about $51,000 in SDR quarterly dividends. Not too shabby! To each his own.
Emotion at play! Nothing has changed. The oil is still flowing, the ships still hauling oil to the refineries. Next week the Kaiser's video will be history and the Market will be what it is . . .
BPT hit this price range during early 2012. That was a purchase opportunity. Perhaps it is such once again?
Petroleum fuel, and the manufacture of it, is taxed to make solar and electric vehicles appear economically reasonable, a current political policy in the U.S. Even now U. S. fuel for farm vehicles is $0.75 per gallon less than highway use.
Fuel in countries like Norway gasoline is near $8.00 per gallon, in Venezuela it's less than $1.00 per gallon.
During 1985 and prior, the Fed discount rate went to 21 percent destroying business and employment. Many of us never experienced those years. More than six years were required for business history..
With current interest rates lowest in decades there is no place for the Fed discount rate to go but UP. Adjustable rate loans are frequently the shadow danger of economic security and that is the current situation for too many borrowers today...
Thank you for your recall of business and national history..
It is not indifference or arrogance, it is avoidance of exposure to law suits.
Management must carefully, legally research every word released about economic and other aspects of their business activities less they be sued, down the road, for misleading statements, or other inventive legal propositions.
I hesitate to point out that the life of any related trust and the life of petroleum well production are two different animals. In some situations petroleum production continues long after the legal life of the trust expires.