Seeking Alpha

Transcend Asset

View as an RSS Feed
View Transcend Asset's Comments BY TICKER:
Latest  |  Highest rated
  • Shipping: This Rally Doesn't Add Up [View article]
    Korea Line had a contract with Eagle and Eagle was stuck. To me, the change in charter revenue and the settlement means the firm is now out from under a huge rock. They are freed from their signed commitment and able to do business with others.
    May 19 01:52 PM | Likes Like |Link to Comment
  • Shipping: This Rally Doesn't Add Up [View article]
    Gross time charter and freight revenue are also up from prior year. $73.6 m vs $54.8 m from last year`s quarter.
    May 19 12:46 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Wow, Ramisle, check this out:

    This is a rights offering that only allows 20 days to exercise. Backstoppers... never heard of such a thing. Looks like capitalists willing to buy up any rights others won't take under special terms.

    ``In consideration for providing its backstop commitment, the Company has agreed to issue to each Backstop Investor that is not an affiliate of the Company immediately prior to the completion of the rights offering a number of additional common shares equal to 3% of its backstop commitment. In addition, the Company has guaranteed certain Backstop Investors minimum participation amounts which, depending on the participation level of the Record Date Holders, could cause the amount of shares to be issued and the gross proceeds raised to exceed $75.0 million.``
    May 19 11:42 AM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Wow, never heard of SBLK. Share prices on it have been going up but what's Google Finance saying... EPS is negative $71?! Ok.... I thought maybe GFinance is broken (sometimes, it is inaccurate). Over on, the reading is negative $58. This one is WAY more messed up than Eagle.

    But that's so irrational. Why are people buying SBLK?! institutional ownership only at 10%. I'm afraid the banks behind the secondary are selling a lemon. They do push out junk on unwitting retail investors. My initial response is this is SBLK is a big lemon.
    May 19 11:23 AM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    On further thought, if bankruptcy was to benefit any bank, it would have to be assumed that while one set of banks are taking one side, another is taking the opposite. For example, RBS and a bunch of Euro banks are creditors. GS and RBC are equity shareholders. When RBS and its cronies declare default, then GS and RBC lose. This then becomes the crazy game much like the Bear Stearns vs. Goldman thing. Freaked out hedge funds and retail investors would run for the gates on all shipping stocks. You are suggesting this scenario? But is this logical? Then is GS being stupid by BUYING more Eagle stock? That's very weird. Why do that except if you are already in on the loan terms and really closing in on the Eagle on all sides and forcing it up? Pretty much, fully controlling the destiny of the stock on its return. They lose on the equity side of their deal if they foreclose though. Isn't that stupid?! Throwing so much more money on a stinking sinking ship?

    Well then, why is RBC and Invesco doing the same? Are they all 3 very stupid? What's the card up their sleeve?????
    May 18 10:36 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Thanks -- looks like we at least agree that there are DEALS going on with banks. I see the deals as a win-win game. The banks are participating in profits on all the new fleets they helped Eagle to launch since 2010. 50% profit on monies above $20,000 from each of these fleets. Eagle is already held hostage by banks. Then again, the banks are held hostage by Eagle. The banks are choosing to keep it alive, not kill it. It looks good on their books (yes, so they milk Eagle) -- but guess what? They don't have to report huge losses across the board, which I predict will happen when all their shipping assets suddenly drop to 50 cents on the dollar. Banks have huge portfolios in shippers. Not just Eagle. I do not see them as being prepared to see a big zero. It will cost banks more and increase their risk to help startup a new shipper. They have to keep what's going floating. Your view is that they are moving towards ultimate control by seizing assets and forcing Eagle into bankruptcy. I am saying they cannot because the largest shareholders of Eagle are banks themselves. Unless they want to fight amongst themselves? I am proposing that there are overlaps between the lenders of the term loan and the shareholders. What, they try and strangle their own equity holding in order to try and get something out of privatization?! The math doesn't add up. Lose a lot in the equity side, sell off Eagle assets and try to settle debt or try and run Eagle with Eagle's CEO? Well, I think they are at their sweet spot already -- they ARE running Eagle and Eagle's CEO. Any further move would mean losing on their equity holding through normal bankruptcy procedures only to try to settle their creditor side of the deal. What the heck? Illogical.
    May 18 10:21 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Dilution is viewed as a problem by some. But keep in mind that many companies grew by dilution. For companies to grow, secondary offerings are made in the market when they do not want to borrow directly from a bank. It is my view that dilution is not necessarily a bad thing. Sure, shorts get to make a temporary gain from shorting during the initial announcement of new shares... but in the long run, it should be interesting to note that when there are buyers for convertible prefs, corporate bonds, and new shares -- this is due to a valuable investor perspective on the company.
    May 18 10:07 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    The BDI has been trading stuck in a zone. They've gone up and down in a range. Last year, from June to July, it rallied. Tanked in August. Rallied Sept through to mid-October, drops, rallies in mid-November. I really don't know where the BDI will be going and think it's not running in correlation with shipping prices, to be honest. About mid-February, I was starting to see a disconnect. Everything seems centered on how the banks and economic conditions are perceived to be doing. I've seen BDIs go down while various shipping stocks climb. I've seen BDI go up and shipping stops drop. Maybe you've 20+ years of experience with the BDI and can explain some seasonality that I don't get. Be glad to learn more about how you can conclude BDI will fall in summer. I am looking at a year's view of BDI as per this link:

    It rallied in June last year. Why can't it pickup from a huge drop around the same time last year and be the same as last?
    May 18 09:53 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Another strange thing about banks and their relationship with shippers: the money seems to be pouring in on them like crazy. Take a look at the Nasdaq institutional holding share increase/ decrease.

    Goldman, as a large shareholder, seems VERY optimistic about Eagle. Their holding increased 4,656%. Invesco, 694%. RBC, 79%. Of course, you should then look at the decrease and close out numbers too. On that list seems to be institutions with far more financial problems -- probably had to liquidate to take care of the home front.

    What does that say about our financial institutions? What are the so-called more financially sound institutions doing with their money?

    Draw your own conclusions. I think if the shippers fail, which banks will be top dog and which an underdog will also change.

    Take a look at the numbers for the other shippers as well and let me know your thoughts.
    May 18 11:18 AM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    In my view, Basel III is not going to have much of an impact in North America. The last time I looked into this, I was under the impression both US and Canada didn't care much for it.

    It's really Europe that's been jumping for joy noting the banks are shoring up capital. NBG is a cash in point. Oops, I meant to write case in point, but since it came out as cash... funny, but apt.

    However, since this is the second time Basel is mentioned in this forum, I will take a closer look. Thanks for the head's up -- I don't want to be caught unaware or be said to take an overly optimistic view on things.
    May 18 11:01 AM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]

    I have thought about that possible "fact" while writing but with too many things spinning in my head, this somehow failed to get addressed.

    With only the mortgage crisis as my comparative, my thought on this is that we're not looking at one case, but a possible domino effect which will have a crushing impact. As has been talked about in here, the book value vs. liquidation value can differ by 200 million. Further, as the mortgage crisis and housing crisis has shown, when too many houses flood the market, prices on homes can be cut in half. With so many shippers teetering on the brink of bankruptcy -- or actually, on life support and as good as dead without it -- the situation is one of avoidance. The banks are either avoiding reality by throwing good money after bad (extending loans, extending term dates, changing line of credits to term loans) -- or the banks are trying to keep things from getting worse by hoping to avoid a crisis. In Eagle's worse case, liquidation value is probably $500 million. Then what? Doesn't that put the banks in for a greater loss of $500 - $900? Asset sales also take time, and closing costs can mean greater loss. That said, I think the biggest problem for banks is too much bad press. Banks hate attention and want to manage their PR and also avoid lawsuits. With one big shipper down, there will be calls to tighten credit facilities to the others and then we've more failures. I think this is all a carrot and stick affair right now. The banks strike fear, the shippers want to survive, so they pay up in the best they can. The banks don't want to actually become shippers. The banks actually fear having bad press and losing the ability to cause fear in other shippers. As demonstrated in the mortgage crisis, too many homeowners defaulting and walking away without further thought about trying to keep up with payments causes the problem to explode. I think a similar problem would happen if assorted shippers disbanded and just closed shops one after the other.
    May 18 10:56 AM | Likes Like |Link to Comment
  • Shipping: This Rally Doesn't Add Up [View article]
    Diana has an average fleet age of 6.0. Eagle has a fleet age of 5.9.

    Eagle is also a special case as per my article:
    May 17 10:24 PM | Likes Like |Link to Comment
  • Uni-Pixel - A Stock Ready For New Highs [View article]
    Some investors were probably quite displeased in the stock being stuck trading in a zone. Given other investments (such as NBG and EGLE) doing 15% to 20% a day, this one is now on the back burners.

    It may be back to the $32 - $33 area on Monday, and stuck there for who knows how long.
    May 17 05:25 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    This is also a small portion of my investments. Though it has grown to about 5% due to appreciation.

    Solar is one heck of a headache... I can't quite pin it down on how to handle those stocks (yet).
    May 17 05:08 PM | Likes Like |Link to Comment
  • Eagle Sinks On Inaccurate Reporting: Banks Need Shippers Badly [View article]
    Thanks, I have looked into TBSI. The difference between TBSI and EGLE is that TBSI had really old ships, something like 22+ years average. They also have the ability to handle only 1.5 dwt. Moreover, they were only doing cargo, no time chartering. They've got some of the worse stats going into the recession. Hence, it's a no-brainer they disappeared. In comparison, EGLE sits with 5.9 yr and 2.4 million dwt. They went into timechartering (caved to the times and did some itsy bitsy stuff to keep going). Big differences in size of operations.

    EGLE, I will admit, was a major headache for me when I first got into it last year. It was a headache to learn as much as I can about shipping. I was also extremely concerned about whether the U.S. unemployment rate/ recession/ elections, etc would have a long-drawn effect on everything on the market. I tend to go for the macro view at all times.

    The fear was another 10 years tacked on to the recession. By then, Eagle's ships would be old. No measly line of credit to revamp their ships would convince me that that would be enough. Interestingly, I read somewhere Eagle has yet to draw on their $20 m funding for new ships. Can't seem to find the blurb at the moment.

    EXM freaks me out because it has a very low 5% institutional holding (though interestingly, Wilbur is on to that one too... and the California Public Employee System too). The Cal PES is also a fairly significant holder of EGLE. Moreover, EXM's head office is in Bermuda. I don't know if it's just me, but I have trouble trusting info coming from a tax haven country. If EXM were dead tomorrow, the impact is less drastic. It's liabilities are somewhere around $200 - $300 million, if I remember correctly. This is a small fry in the shipping ocean.
    May 17 05:03 PM | Likes Like |Link to Comment