Logan Corbin

Growth at reasonable price, contrarian, macro
Logan Corbin
Growth at reasonable price, contrarian, macro
Contributor since: 2013
Agree, the yield is under pressure in a good way - couldn't say if it will change or not, it's been about a year since the last one but it seems unlikely
"But, after the dividend cost, expenses, and commissions, the shareholders are happy, but the company has no assets, no savings, and continually growing share count."
On one hand you are saying that this model will make shareholders happy and on the other, that the business will dissolve to no assets and no savings, how does that make shareholders happy?
I believe your point is that the company risks its own equity in order to keep 'shareholders happy' with dividends. Yet average ROE values are reasonable despite charter rate pressure, fleet realignment and of course, secondary offerings. While I disagree that the price will dilute to nothing, it may suffer at the expense of these enormous dividends though revenue growth should outpace the float growth. However, if you believe in upcoming global growth, (DCIX) is a great place to get paid to wait for it.
Strong Sell? This company just beat estimates on earnings and revenue and maneuvered from poor charter rates in the Panamax segment. Great balance sheet, tons of cash and growth ahead. Cannot say that I agree with most of this article, (DCIX) is a buy.
-Same business model : they are buying second-hand and new vessels and selling time charters. Nothing has changed
-Charter rates are lower? no one should be surprised by this, most expect this to pick up going forward this year and next, especially in the larger vessels, which the company has stated they will be acquiring with all of their new cash
-Your dividend model shows new ships as the same size as the old ships just with better rates, there will not only be better rates but they will have larger TEU capacity
-The company needs money for acquisitions, what better way than to sell the crappiest assets for top dollar, old ships with no renewing charters have helped combine for 9 digits of cash for acquisitions
$DCIX : Not tagged as such, but Diana Containerships, Inc (DCIX) is a highly ranked dividend stock: big yielder, consistent, growing, and of course upcoming (for $0.30 / share dividend, own by 6/4/13)
HD at time of article 71.40, price called in article 79.50, pre-market trading today: 79.45.
Earnings announced : Net earnings for the first quarter were $1.2 billion, or $0.83 per diluted share, beating estimates and providing great guidance as called.
Thanks number19,
You bring up a great point, the SPDR Health Care ETF (XLV) & SPDR Consumer Staple ETF (XLP) have outpaced the XLB and SPDR Industrial ETF (XLI) for that matter. Your chart reflects how they have also been more resilient to drops in the overall market. I consider these four ETFs in my article: http://seekingalpha.co...
Moreover, I would argue that a correction is unlikely. If negative price action were to happen, it is going to stem from sectors where earnings fail to meet expectations. It seems that in the SPDR Basic Materials ETF (XLB) it will be easier to meet already low expectations than for XLP and XLV companies like Wal-Mart (WMT) or Pfizer (PFE). XLB companies and also companies like Home Depot (HD) are more likely to beat estimates because they support real underlying growth in the US economy, whether that be creditable to housing, automotive or aerospace.
It is important to consider all scenarios when investing, while I do not believe a correction is coming, if it were to happen, I am long VIX futures ETF (VXX).
Disclosure: I am not an investment advisor, I am long VXX, HD.
As I mention in the article, the news was mixed. With the company missing on revenue estimates, investors seem concerned about the growth prospects. I cite the call in the article because it points to the growth prospects and guidance which are not only strong for Alcoa but also for the sector as the economy improves.
Thank you for this point, I should clarify this. Although the candidate claimed he was a supporter of coal the fact is, the rhetoric during the Long Island, NY town hall October 16th, 2012 the perception was that Romney was just playing both his base and that of the environmentalists when Obama said to him:
"Governor, when you were governor of Massachusetts, you stood in front of a coal plant and pointed at it and said, ‘This plant kills,’ and took great pride in shutting it down. And now suddenly you're a big champion of coal."
After his loss, many investors thought the current administration would continue to hurt the industry as I address in the article. The point is, neither Obama nor Romney nor any other person or administration is going to blunt the advance in global coal demand.