Time To Buy DryShips? Feb.19.17 | About: DryShips
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Posted On: 02/19/2017 10:47:41 AM
Time To Buy DryShips?
Feb.19.17 | About: DryShips Inc. (DRYS)
Short Only
DryShips diluted shareholders as expected. But the good news is that the firm's liquidity situation improved.
There will be a lot of reactionary calls to short DryShips now, but reactionary advice is usually useless.
While we believe DryShips is a terrible stock, those bullish on the shipping industry may find now to be a good entry point.
If you poke a balloon with a needle, will you be surprised if it pops? This question must be asked of DryShip's (NASDAQ
RYS) investors and other market participants. The market is acting surprised by things it should have been expected to occur.
DryShips is a bad investment, and this will not change in the foreseeable future. However, for risk-loving "smart money" Baltic Dry Index (BDIY) bulls - who were keen enough to hold their money until after the dilution - now may be a good entry point to go long the stock. Short-term liquidity challenges have been addressed through a dilution of the "dumb money."
Full Disclosure: The author thinks the DryShips will eventually go bankrupt, and there are better opportunities in shipping.
The Feb 14th article "Countdown to the Next Diltution" was a virtually perfect call. And here we are, not even three days later another dilution is upon us. On Feb 17th, DryShips entered into a $200 million share purchase agreement with Kalani Investments Limited. $1.5 million worth of DRYS stock will be given to Kalani as a commitment fee.
It was noted, perhaps in responses to speculations, that Kalani has no affiliation with DryShips. What was omitted, however, was any mention of the mysterious company's relationship with George Economou, DryShip's self-dealing CEO. We believe that Kalani is affiliated with Economou, and the failure to dispute this assertion affirms our belief. DryShips has been contacted with these concerns; we are yet to receive a response.
Dumb Money vs. Smart Money & the Danger of Reactionary Investment Advice.
When a stock loses 20% of its value in a matter of hours, it's usually the result of a massive surprise or some black swan event. However, in the case of DryShips, the event was evident to anyone who looked at the data objectively.
About this article:Expand
Feb.19.17 | About: DryShips Inc. (DRYS)
Short Only
DryShips diluted shareholders as expected. But the good news is that the firm's liquidity situation improved.
There will be a lot of reactionary calls to short DryShips now, but reactionary advice is usually useless.
While we believe DryShips is a terrible stock, those bullish on the shipping industry may find now to be a good entry point.
If you poke a balloon with a needle, will you be surprised if it pops? This question must be asked of DryShip's (NASDAQ
RYS) investors and other market participants. The market is acting surprised by things it should have been expected to occur. DryShips is a bad investment, and this will not change in the foreseeable future. However, for risk-loving "smart money" Baltic Dry Index (BDIY) bulls - who were keen enough to hold their money until after the dilution - now may be a good entry point to go long the stock. Short-term liquidity challenges have been addressed through a dilution of the "dumb money."
Full Disclosure: The author thinks the DryShips will eventually go bankrupt, and there are better opportunities in shipping.
The Feb 14th article "Countdown to the Next Diltution" was a virtually perfect call. And here we are, not even three days later another dilution is upon us. On Feb 17th, DryShips entered into a $200 million share purchase agreement with Kalani Investments Limited. $1.5 million worth of DRYS stock will be given to Kalani as a commitment fee.
It was noted, perhaps in responses to speculations, that Kalani has no affiliation with DryShips. What was omitted, however, was any mention of the mysterious company's relationship with George Economou, DryShip's self-dealing CEO. We believe that Kalani is affiliated with Economou, and the failure to dispute this assertion affirms our belief. DryShips has been contacted with these concerns; we are yet to receive a response.
Dumb Money vs. Smart Money & the Danger of Reactionary Investment Advice.
When a stock loses 20% of its value in a matter of hours, it's usually the result of a massive surprise or some black swan event. However, in the case of DryShips, the event was evident to anyone who looked at the data objectively.
About this article:Expand
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I'm in it to win it!
NASDAQ DIP and RIP
Here is the best word that describes what i do here.
Intuitive;
means having the ability to understand or know something without any direct evidence or reasoning process.
I was born with it, I'm truly blessed!
Alway's searching for winners'
NASDAQ DIP and RIP
Here is the best word that describes what i do here.
Intuitive;
means having the ability to understand or know something without any direct evidence or reasoning process.
I was born with it, I'm truly blessed!
Alway's searching for winners'