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Diana Shipping Inc. Message Board

warmcamp 12 posts  |  Last Activity: Apr 23, 2015 5:52 PM Member since: Oct 15, 2003
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  • warmcamp warmcamp Feb 20, 2015 1:31 PM Flag

    Companies have to sell below cost because they have to make payrolls and pay vendor bills. The alternative means closing the business. Hopefully, you understand that in case business is closed, shareholder equity goes to zero.

    Despite the general consideration above, PAAS and other silver miners could take few steps to address low silver price. After all, low silver price is not something new, it continues for long time already. The could consider closing the worst (higher-cost) mines and canceling dividend. It seems that most mining companies prefer to swim along hoping than metal prices will recover without any actions on their part.

  • warmcamp warmcamp Feb 20, 2015 1:46 PM Flag

    I didn't notice any relative outperformance in AG share price comparing to other miners. Holding fraction of production on hold for a quarter won't affect market silver price at all. It is enough to say that pure silver producers deliver less silver than copper and zinc miners. However, taking operating steps, such as closing the higher-cost mines, would reduce production gradually and it could become a factor in due time.

    Also, I would suggest you to think a bit before giving out estimates of other people experience or abilities. Communicating with people in careless way will just reduce your chance to hear better informed opinions.

  • Reply to

    ??

    by doncreelson Mar 4, 2015 12:23 PM
    warmcamp warmcamp Mar 5, 2015 6:44 PM Flag

    Good message, Silvercomments. I do not agree with all points but I support many of them. By and large, miners play silly games by promising and delivering record production at silver prices guaranteeing capital losses. What other industry could afford it?

    This bear market continues for 2 years already (by the most optimistic count) and companies show no real signs of adjustment. It confirms chronic problems in corporate development; these companies are made for bull markets only.

  • Reply to

    PAAS fell today again? Umposible!!! :-)

    by silvercomments Mar 6, 2015 11:59 PM
    warmcamp warmcamp Mar 7, 2015 7:30 AM Flag

    Actually, PAAS management is not the worst in the sector; though one should remember that average level of management in PM miners is just awful. This company has better than average operating performance; i.e. these guys can move stuff around mines. The problem is that beyond mining they behave like the most stubborn goldbugs.

    Regarding possible improvements, firstly, they should cancel dividend. The whole idea of paying money out of treasury is not healthy and with worsening operating numbers it would be the most logical thing to do for any financially literate managers. Regarding operations, mothballing unprofitable mines etc, it was mentioned correctly that it is impossible to do it overnight. However, it is something that could be done in two years, for sure, and, in this respect, management wasted last two years keeping heads in sand, dreaming about sudden return of silver bull market.

    Will they do something now? Firstly, it would involve admitting mistakes and, again, they are stubborn. Also, any operational changes will take time with count starting only when it really starts. Dividend can be still cancelled at once. Most likely, it would cause another drop in share price; it makes unreasonable to buy right now; that's investor perspective.

    Continuing on investor perspective, bear market persists and financials worsen. It dictates continuing reduction in investor interest in this sector. It is always possible to try a quick TA trade here or there, but risks continue increasing. The whole sector is not worth of anything serious now.

    Final notes: PM miners have zero control over metal price and it comes by very serious reasons. There is no chance for improvements on this issue. Also, I agree with you that "cash cost" is a ridiculous measure; it is a very old issue with this industry. By the way, "all-in" yardstick, started few years ago, quickly loses credibility too.

  • Reply to

    When does PAAS cut the Dividend???

    by infoonstocks Mar 30, 2015 6:35 PM
    warmcamp warmcamp Mar 31, 2015 5:43 PM Flag

    Financial side of the story is clear; dividend cut would be natural here. The obstacle comes from management; they are stubborn. How long can they continue being stubborn? Who knows. It can continue long enough; this company has cash. It may happen that people, waiting on sidelines, see the situation, eventually, when dividend is cancelled, finally, but company cash got depleted to the point when risk is too high.

  • Reply to

    Silver

    by sealteam_00006 Mar 31, 2015 3:23 PM
    warmcamp warmcamp Mar 31, 2015 5:43 PM Flag

    This "break-even" number can vary depending on quarter details. In general, one may use $18.

  • Reply to

    Silver

    by arizona_guy77 Apr 4, 2015 10:44 AM
    warmcamp warmcamp Apr 4, 2015 11:38 AM Flag

    Most likely, silver will be higher on Monday, bolstered by bad job report. It is quite possible that $17 will be reached next week. However, I don't think that it rules out Fed actions in future and it is too early to say whether silver price makes a resolute turnaround at this point.

  • Reply to

    Question for knowledgable share holders

    by dj_rocks_it Apr 6, 2015 2:12 PM
    warmcamp warmcamp Apr 6, 2015 5:34 PM Flag

    You will get back full amount of this withdrawal, when you file your U.S. taxes. The number, "foreign tax credit" will be in your 1099 brokerage form. Remind your accountant to record it properly.

  • warmcamp warmcamp Apr 12, 2015 7:36 PM Flag

    It seems to me that company will either sell/reduce Bongara interest (probably, to Peruvian partner) or dilute at this level (it would be about 20% dilution). Both scenarios look doable, so I don't think that bankruptcy is a real threat at this point.

  • warmcamp warmcamp Apr 16, 2015 6:02 PM Flag

    I think that zinc is more prized asset at this economic juncture and this company has financial problems. Which asset would you prefer to pick up if you, prospective provider of new funds, have choice?

    Yes, it is just a guess, but I think that chances for possible financing go following: 1. Dilution 2. Bongara deal 3. Hamilton deal. By the way, I think that it would be better for present shareholders to have it in backward order, but shareholders never decide.

  • Reply to

    Silver continues to tank

    by arizona_guy77 Apr 22, 2015 11:42 AM
    warmcamp warmcamp Apr 22, 2015 6:15 PM Flag

    Probably, your questions were rhetorical. Please, accept my apologies if they were not.
    In case it is not rhetorical, stock longevity can be better assessed through financials. The first step is to check balance sheet (net cash position) and cash flow statement (cash burn rate). Further analysis can take into account future developments, because financial numbers are not static.

    In this respect, PAAS has very strong financials, as you definitely know it already. If company cancels dividend then it would be able to go without any troubles for 2-3 years just using present cash hoard. If it doesn't cancel dividend, then it has credit line, recently arranged, that provides big and cheap funds (only 3-4% interest). It can be asserted that PAAS is one of the strongest, financially, PM stocks at the moment.

    In other words, this stock is not in financial jeopardy and it creates some room. If you already have shares and you decide to sell, by any reason, then you can still do it on your own terms, i.e. you could wait for a short-term rebound and sell for slightly better price. it is not warranted, but it has chances; stocks always go up and down.

    If you don't want to sell shares then share price is less important now and you could wait for sector rebound. Sooner or later PM sector will recover; nothing goes down all times on market. Obvious enough that exact timing is hardly predictable. At least, Chapter 11 is not a threat; so you could always count on future recovery.

    Please, don't take my message as too pessimistic. It is not. Good luck with your investment.

  • Reply to

    Silver continues to tank

    by arizona_guy77 Apr 22, 2015 11:42 AM
    warmcamp warmcamp Apr 23, 2015 5:52 PM Flag

    Firstly, substantial part of silver supply comes from non-silver miners, producing silver as sub-product. They don't care too much about silver market.

    Secondly, silver supply exceeds "non-investment" demand that includes industrial usages, jewelry, silverware, etc. The gap between supply and non-investment demand is closed by "investment" demand. It means people and entities buying silver for hoarding; they don't "consume" it. This investment demand is fickle and lack of it creates oversupply of silver market.

    In any case, silver follows gold, because of this "investment" factor. Silver is always considered as gold's little sibling, in investment terms, and silver miners cannot get out of bear market as long as gold is in bear market.

    Probably, you heard all of this already. I repeat these points only because your message raises these issues. It is good, imho, when message board discusses serious topics.

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