Entering text into the input field will update the search result below

DryShips: Kalani Update

Jul. 09, 2017 12:21 AM ETDryShips Inc. (DRYS)73 Comments
Research & Investment profile picture
Research & Investment


  • I expect that in the fiscal 2017 the company will generate better earnings.
  • The company has a strong balance sheet.
  • Their poor share performance will continue until the dilution is over.
  • It is speculated that the company will go for a fresh deal.
  • I expect the round 4 Kalani deal will be completed in a couple of months.

Investment Thesis:

DryShips (NASDAQ:DRYS) has provided investors with an update of the share dilution. The share price collapsed from $4 to $1 since the latest reverse split. The company still needs to raise $82.9 million. Therefore the share price collapse and reverse splits are unavoidable.

Following the settlement for all of such Shares sold as of the date hereof, the Company will have a total of 26,609,379 shares of common stock outstanding. As of the date hereof, up to $82.9 million of the Shares is remaining that the Company may sell pursuant to the Purchase Agreement.

Kalani Update as of July 7, 2017

The company’s daily dilution generates a constant increase in share count. On June 22, 2017 (7th reverse split), the company had 5.65 million outstanding shares. Within the 10 days, the company added 20 million new shares.

Source: Created by Author (data obtained from SEC filings)

As we can see from the above chart, the company has been issuing about 2 million shares per day and the company is still managing to raise $2 million per day.

Source: Created by Author (data obtained from Yahoo Finance)

The share count increase has a direct relationship with the share price decrease (see the above charts share count vs share price). At this rate of dilution, only a couple of trading days will break the $1 mark. It should hit $0.50 if there is no reverse split announced this month. As well as this the company is facing numerous legal issues. There are more than a few legal firms investigating DryShips for the potential violation of federal security laws. DryShips’s investors filed a lawsuit against its CEO for breaches of fiduciary duty, unjust enrichment, and conflict of interest.

Revenue Forecast

According to Reuters, since beginning of this year, DryShips has taken delivery of

This article was written by

Research & Investment profile picture
Ranked #1 on Seeking Alpha for Services sectors stocks. To get notified when I release a new article simply hit the big orange follow button. The author is a mechanical engineering diploma holder with over 15 years experience in engineering, management, and investment. The author has written "HOW NOT TO LOSE MONEY IN THE STOCK MARKET:" http://seekingalpha.com/article/4022446-lose-money-stock-market

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.