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  • The High Dividend Stock Investor's Collapsing Dollar Survival Guide, Part 6B [View article]
    We all know the stock market is a discounting mechanism that is likely to rise long before improving conditions are apparent. How do you propose to time the entry into these stocks?

    If you buy today when prices have discounted awful outcomes and hold for 5 years it is not impossible to expect to achieve a double. This means a 15% annual return. Perfectly acceptable to me as an investor.
    Mar 25 07:05 am |Rating: +2 0 |Link to Comment
  • Excel Maritime Carriers: Set Up To Excel  [View article]
    Evaluating a business requires more than just looking at ratios. EXM is a very good business. . Here are some qualitative thoughts;

    1) Maritime shipping is an important business. Entry is not easy.
    2) BDI rates are volatile. EXM business is built around AAA customers who sign long term contracts and need a reliable shipping resource. Getting your goods from point A to B in the promised 12 days is important o both customer and supplier. EXM has a reliable modern fleet. The BDI is not as important in the long term.
    3) Many of the new ship yards are not coming on line. Consequently forecast overcapacity is not accurate.
    4) EXM has 4 new ships scheduled for delivery. All have been prechartered and will provide positive cash flow.
    5) The deep pocketed partners of this company will provide capital for future investment limiting EXM need to invest cash. Since the major owners are interested in dividends this should leave cash available.
    6) Although the balance sheet has a heavy debt load it must be understood in the context of this industry. Investing in ships takes capital, often borrowed. The lenders understand this. If the value of the ships fall and the company violates debt covenants the lenders may view this as a technical default. As long as cash flows are continuing and the loan is current they will not foreclose. Think of the ship as a machine that generates revenue. As long as this continues what difference do the ship values make in the short run.
    7) The world growth story may be slowed but not permanently impaired. EXM is well positioned to take part.

    I own stock in EXM
    Jan 09 07:16 am |Rating: +7 -1 |Link to Comment
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