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Dhinesh Ganapathiappan Chris Botros Helen Huang Karl Laughton

Dhinesh Ganapathiappan Chris Botros Helen Huang Karl Laughton. Company Profile. Founded in 2004 and headquartered in Athens, Greece Went public in 2005 on the Nasdaq Owns and operates drybulk carriers for the transport of drybulk commodities including grains, fertilizer, coal and steel

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Dhinesh Ganapathiappan Chris Botros Helen Huang Karl Laughton

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  1. Dhinesh Ganapathiappan Chris Botros Helen Huang Karl Laughton

  2. Company Profile • Founded in 2004 and headquartered in Athens, Greece • Went public in 2005 on the Nasdaq • Owns and operates drybulk carriers for the transport of drybulk commodities including grains, fertilizer, coal and steel • Operates a fleet of 46 vessels: 5 Capesize, 31 Panamax, 2 Supramax, 8 more in production • Carrying capacity of 4 million deadweight tons • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  3. Industry Analysis • Japan is the largest builder of bulkers, and 82% of all these ships are built in Asia • Six types of bulkers: small, handysize, handymax, panamax, capesize, and very large • Panamax is the largest bulker to fit through Panama and Suez Canals • Bulkers are chartered according to spot prices on the Baltic Exchange Dry Index • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  4. Key Statistics • NASDAQ ticker: DRYS • Stock price: $91.96 • Market capitalization: $3.8 billion • Price to Earnings Ratio: 7 • Estimated Forward P/E Ratio: 6.5 • Profit Margin: 82% • Return on Assets: 15% • Return on Equity: 64% • Cash: $111 million, Debt: $1.2 billion • Dividend Yield: 1% • Insider Ownership: 36% • Beta: 2.54 • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation ** As of May 9, 2008

  5. Technical Analysis • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  6. Baltic Exchange Dry Index • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  7. Competitors • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  8. Competitors • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  9. SWOT Analysis - Strengths • CEO owns a 45% stake of company and has incentive to generate maximum earnings for shareholders • CEO also has over 25 years of experience in the maritime industry • Company is the largest in its industry and is the fastest growing per year • Quarterly earning growth is 441% • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  10. SWOT Analysis - Weaknesses • Profits tied directly to Baltic Exchange Dry Index – the company does not make long-term contracts and depends on the spot market • Company bought a 30% stake in deep-sea oil drilling company for $400 million – distraction from core business. • Company has a debt of 1.2B • In the shipping industry as a whole DryShips has less market power due to it small market cap • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  11. SWOT - Opportunities • Continued demand from emerging markets in China and India • Increase in the need for ships, putting more demand on the company to build ships and serve the market • The growing global economy is increasing the demand for shipping. • As shipping by ocean gets more faster and more efficient companies will consider switching to shipping by ocean. • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  12. SWOT Analysis - Threats • More ships being built and flooding the market in the next 1-3 years • After enough ships are available there will no longer be a high incentive for growth • When newer companies begin using faster and higher efficiency ships, DRYS will need to upgrade which will cause it to invest a large amount of capital. • Ships are new because DryShips is a young company but once ships get older, large amounts of capital must be invested in the maintenance of ships • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

  13. Recommendation • Strong buy in the short-term based on attractive valuation and market trends, but the long-term picture is not as bright as ships are brought into the market and drive down pricing power • Company Profile • Industry Analysis • Key Statistics • Technical Analysis • Competitors • SWOT Analysis • Recommendation

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