QUOTE AND NEWS
SeekingAlpha  Oct 15  Comment 
By Orange Peel Investments: By Thom Lachenmann We don't spend an awful amount of time on shipping stocks. We know that it has been tough going for those that have been in the sector, and we no longer have a consultant for dry bulk analysis as...
Motley Fool  Sep 23  Comment 
After an encouraging year for the shipping industry in 2013, Diana Shipping investors are worried again about its future.
StreetInsider.com  Sep 15  Comment 
Majesco Entertainment (NASDAQ: COOL) 20.8% LOWER; reported Q3 EPS of ($0.58), $0.16 worse than the analyst estimate of ($0.42). Revenue for the quarter came in at $2.9 million versus the consensus estimate of $6.1 million. The Board of Directors...
SeekingAlpha  Aug 4  Comment 
ByQuoth the Raven: Looking at a chart of a bunch of the publicly traded dry shippers over the last 3 months isn't a pretty sight. With the exception of Ocean Rig (NASDAQ:ORIG), which has had some success in signing contracts the past couple of...
Benzinga  Jul 31  Comment 
Diana Shipping Inc. (NYSE: DSX), (the "Company"), a global shipping company specializing in the ownership of dry bulk vessels, today announced that, through a separate wholly owned subsidiary, it entered into a time charter contract with Bunge...
SeekingAlpha  Jul 29  Comment 
Diana Shipping Inc. (NYSE:DSX) Q2 2014 Earnings Conference Call July 29, 2014 9:00 AM ET Executives Edward Nebb – Investor Relations Simeon P. Palios – Chief Executive Officer Anastasios C. Margaronis – President ...
StreetInsider.com  Jul 28  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Diana+Shipping+%28DSX%29+to+Buy+Shares+of+Diana+Containerships+%28DCIX%29+/9693475.html for the full story.
Market Intelligence Center  Jul 25  Comment 
The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artifical Intelligence Center found a trading opportunity with Diana Shipping (DSX) that should provide a 11.73% return in just 238 days. Sell one Mar. '15 call...
Market Intelligence Center  Jul 15  Comment 
MarketIntelligenceCenter.com’s patented algorithms have chosen the Jan. '15 $10.00 call for a couple of hedged-trading ideas on Diana Shipping (DSX). A traditional covered call on Diana Shipping yields 10.01% (19.65% annualized, for comparison...
Market Intelligence Center  Jul 14  Comment 
The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artifical Intelligence Center found a trading opportunity with Diana Shipping (DSX) that should provide a 9.41% return in just 187 days. Sell one Jan. '15 call...




 

Diana Shipping Inc. (NYSE:DSX) owns and operates 23 dry bulk shipping vessels with a capacity of about 2.5 million deadweight tons. Diana's fleet is one of the newest in the world, being over nine years younger than the average merchant fleet.[1][2] The company earns its revenues by chartering its vessels to other companies for periods of two to five years for a fixed daily fee. The chartering of these vessels involves the delivery of commodities like iron ore and wheat throughout the world. shipping rates have exploded between 2006 and 2008, causing Diana's net income to rise over 120%.[3] Unfortunately, the 2008 Financial Crisis and ensuing global economic downturn caused rates to plummet. Prices to ship dry goods felly by 90% in 2008, and have remained near multi-year lows through 2011.

Slowing growth in China has damped demand for raw materials. Smaller demand for raw materials means there's less demand for manufactured goods, both of which mean there's fewer things that need to be transported to and from China. Nearly all of Diana's contracts were negotiated before the fall, but by 2009 half of them expired and came up for renegotiation, at which time the company's margins decreased.

Compared to its U.S. competitors, Diana has been growing slowly, focusing on replacing old ships with new ones, rather than just buying up more vessels. That strategy is soon going to become prohibitively expensive as steel prices continue their rapid ascent. Worse yet, shipyards are running a 3 year backlog. Once that backlog clears, the number of dry bulk vessels in operation will have risen approximately 50%. This increases the amount of competition DSX faces in the future.

Company Overview

Diana Shipping has been growing rapidly, in part because the industry as a whole has been expanding, but also because Diana has been able to raise large amounts of capital through frequent equity offerings. Diana buys new or used but young vessels, and then contracts them out to customers for periods of two to five years for a fixed daily fee.

Unlike its younger peers Genco Shipping (GNK) & Eagle Bulk Shipping (EGLE), Diana has followed a conservative approach to expanding its business based on the goal of maintaining a low level of debt. Diana used only a portion of available financing prior to the credit crunch, missing out on the opportunity to expand rapidly, but ensuring that its level of debt was the lowest of its major competitors.

In 2010, Diana had total revenues of $275 million, growing +15% YoY. Operating expenses grew +26.6% YoY, compressing operating and net margins; operating profit grew +7.3% YoY, and net income grew +5.2% YoY.

In 2009, Diana had total revenues of $239 million, a sharp decline from the previous year's revenues of $337.4 million. Unsurprisingly, its net income fell dramatically as well, from $222 million in 2008 to $122 million in 2009 (-45.1% YoY).

In 2008, revenues grew +77.4% YoY to $337.4 million, when shipping rates nearly doubled. Net income rose from $134 million to $222 million about +65.7% YoY.

From 2006 to 2007, Diana's revenues grew 39%,[2] and its net income rose 120%.[2]

Key Trends and Forces

I completely agree! True, nuatral amber is the most beautiful I have ever seen. I have always enjoyed preparing rough Dominican material and have been amazed at the variety of color one can come across without having to treat it with any type of enhancements.

Rapid Shipbuilding Will Create An Oversupply Of Dry Bulk Vessels

There were contract orders for the construction of enough ships to increase the size of the worldwide fleet of dry bulk vessels by 57% within the next 3 years, excluding ship retirements.[4] While there was disagreement in the industry over whether demand would keep pace, with world economic growth slowing down, there is little doubt that if all new shipbuilding orders were completed there would be an oversupply. However, according to Pacific Basin Shipping Limited, a dry bulk shipper, shipyards won’t be able to complete all of their orders on time.[5] Furthermore, many dry bulk shipping companies make orders or purchase options to buy new ships with the expectation that they will be able to find financing later. They will be able to find financing, but its going to be much more expensive than it was a couple years ago. Every day that the cash squeeze continues lowers the likelihood of an oversupply developing.

Competition

Diana Shipping has the youngest fleet out of its major competition listed on the NYSE. A young fleet is less expensive to maintain, is equipped with more fuel efficient engines, is safer, will get better cargo insurance rates, and is more attractive to potential customers.[6] However, acquiring a young fleet is expensive, especially given the current climate of tight credit and rising shipbuilding costs. Some of DSX's major competitors include DryShips (DRYS), Eagle Bulk Shipping (EGLE), Genco Shipping (GNK), and Navios Maritime Holdings (NM).

References

  1. 2.0 2.1 2.2
  2. DSX 20-F 2009 Item 3 Pg. 4
  3. 2007 EGLE 10-K, Item 1, Page 21
  4. Pacific Basin Shipping Limited – Q1 2008 Trading Activities Update
  5. 2007 DSX, 20-F, Item 3, Page 16
Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki