Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (30533)	4/3/2008 10:28:39 AM
From: Madharry	Read Replies (1) \| Respond to of 78627

i bought more of falling knife mcgc. I believe that some of the market weakness is a function of them being able to obtain financing but with helicopter ben at the helm I believe that obtaining financing over the next 12 months will sort itself out ok. in the meantime I see the stock at a strong discount to intrinsic value if you believe in the company's valuation of its investments and its historic track record. It seems to me that this offers a good potential to return 16% annually at this purchase price so Im in .

To: Paul Senior who wrote (30533)	4/3/2008 10:49:02 AM
From: E_K_S	Read Replies (2) \| Respond to of 78627

Another article on DryShips (DRY)... CEO of DRYS is now compared to John Fredriksen, Norway's richest man and largest investor in FRO. DryShips and the Oil Rush seekingalpha.com =============================================== My observation is that with the high price of oil, all shipping costs are increasing and only the most efficient sectors are going to make money on the margin. Both rail and the bulk cargo group are able to pass along their higher operating expenses per unit of cargo shipped. The truckers and air freight companies are in trouble as they are having a more difficult time passing on their higher fees to the end user. In a recent interview with the CEO of CSX, he stated their trains can haul the equivalent cargo of 250 semi trucks with only a crew of two. Their sector is much more efficient at the margin than the trucking industry and that is why several of the rails are trading near their all time highs. It will be interesting to see what happens as the price of oil continues to increase. Will there be a transition to move more goods via rail and ship cargo (bulk & container) or will the volume of items shipped just decrease due to the higher costs. Maybe at some point, new factories have to be built closer to the end users as the high shipping fees just price the final product out of reach for the intended user. EKS

To: Paul Senior who wrote (30533)	4/22/2008 11:54:05 AM
From: E_K_S	Read Replies (4) \| Respond to of 78627

DryShips Inc. Acquires 33,254,576 Additional Shares and Launches Mandatory Offer for Ocean Rig ASA biz.yahoo.com --------------------------------------------------------- This will give DRYs a total 4 UDW rigs with the option to acquire an additional 2 w/ delivery in 2011. If they are able to acquire the additional Ocean Rig ASA shares at the offered price, the acquisition PE is around 4x expected earnings if all new rigs are contracted at current rates. finance.yahoo.com The combined companies should generate 50% revenues from dry bulk shipping and 50% from UDW drilling. Assuming UDW day rates are contracted at the current $600,000/day each UDW has a pay back of less than 2 years. The value proposition is the combined company should have a more predictable long term cash flow past 2011, they enter a tight market for UDW rigs where day rates could go much higher based on global demand (especially in Brazil), the overall dry bulk fleet has been trimmed and ship age is less than 5 years, and free flow cash is substantial which can be used to reduce debt. Once management consolidates the operations, I believe PE expansion will occur from PE 4 to PE 6-10. Brazil leads world in ships that drill for deepwater oil dallasnews.com From the article:"..."We have renewed the contracts of five rigs for $4 billion for five years," Mr. Barbassa said. "Nine others are being built in many different places to be delivered starting next year. We're going to the market to get more rigs because we're going to need them." Petrobras says it expects to spend $112.5 billion over the next five years to find and develop more oil and natural gas. ..." ------------------------------------------------------ The market seems to be positive on management's acquisition but it might take 8-18 months before the expected EPS are recognized by the market. EKS