Eagle Bulk Shipping Inc. (NASDAQ:EGLE) closed at $29.40, after a fall of almost -10% on Tuesday. On what news exactly? I can’t seem to find anything real. In fact, based on Tuesday’s trade data, both imports and exports to the United States are at record highs. Which means shipping.
Also on Tuesday, Navios Maritime Holdings Inc. (NYSE:NM) dropped 5%. Our March 8 Hot Stock of the Week, dry goods shipper China Cosco Holdings (CICOF.PK), is also still trading in our buying range at $2.80. All these companies are not just profitable… expanding… and fully equipped to turn global commerce into their own personal goldmines. Madness, if you ask me…
Now, in the case of EGLE, a cursory review of news brought up the following:
- Analyst Urs Dur of Lazard Capital reiterates a “buy” rating on Eagle, raising his target price from $40 to $41.
- Jefferies raised their EGLE target to $43 after the acquisition of two Supramax dry bulk vessels.
- Rise in the demand for the fleet is expected to exceed supply in the next 12 months, according to Lazard Capital. The EPS estimates for 2008 and 2009 have been raised from $1.96 to $2.12 and from $2.61 to $3.11, respectively.
- Income from vessel operations of $16.9 million or $0.36 per share, up 44% from $11.7 million or $0.31 per share in the first quarter of 2007.
- Net Income of $14.3 million or $0.31 per share (based on a weighted average of 46,925,494 diluted shares outstanding for the quarter), up 69% from net income of $8.5 million or $0.23 per share (based on a weighted average of 37,480,914 diluted shares outstanding for the quarter) in the first quarter of 2007.
- Gross time charter revenue increased by $9.1 million, or 31%, to $38.6 million for the first quarter of 2008, from $29.5 million for the first quarter of 2007. Net time charter revenue increased by $9.8 million, or 36%, to $36.7 million for the first quarter of 2008, from $26.9 million for the first quarter of 2007
- Based on the first quarter results, EGLE declared a cash dividend of $0.50 per share payable on or about May 23, 2008, to shareholders of record as of May 20, 2008.
And yet, the stock has retraced 18.9% from its recent high of $36.24 on May 19, 2008.
These stocks look like perfect turnaround picks to me:
Buy EGLE below $30
Buy CICOF at or below $2.80.