Started a small position in DRYSHIPS INC. (DRYS) a recent IPO that is a drybulk shipper.
(http://finance.yahoo.com/q?s=DRYS)
Their initial fleet principally carries a variety of drybulk commodities, including major bulks, such as coal, iron ore, and grains and minor bulks, such as bauxite, phosphate, fertilizers and steel products
DryShips Inc. will have a fleet of 25 vessels consisting of 4 capesize, 19 panamax and 2 handymax bulkcarriers aggregating 2.1 million dwt and with an average age of 11 years.
The company has a trailing PE of 8 and an estimated forward PE of 3.85. Starting July 2005, the company has stated that they plan to pay an annual dividend perhaps as high as $0.80 per share (around 4%).
From their 10K "...Our policy is to declare and pay quarterly dividends to shareholders from our net profits each January, April, July and October, beginning July 2005...While we cannot assure you that we will do so, and subject to the limitations set forth below, we expect to declare and pay a dividend per share of $0.20 in July 2005...."
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DRYSHIPS INC. should benefit from the continued global growth in commodity demand (grain, coal, iron ore) by both India and China. These shippers get paid based on (1) long term contracts and (2) spot contract market prices based on the availability of their ships.
EKS |
