Braemar Share Discussion Threads

[edmundshaw] 23/7/2019 09:22

MT but when are we going to see that BDI streak infiltrate the earnings of BMS??

Any ideas? BMS is supposed to be diversifying so that it has a broader exposure to shipping... will we see any benefits this year?

[mount teide] 22/7/2019 08:19

Another day another new 5 year high for the Baltic Dry Index which continues to power ahead, surging a further 40 points(1.88%) today to reach 2,170 - to extend its incredible winning streak to 23 days in 24.

The BDI is up 104.3% over the last 24 days, +264.7% from Zero Hedge's 'armageddon call for the industry and global economy' Feb 2019 higher low (CAGR of 635%), and +628% since the H1/2016 shipping market cycle recession low.

[mount teide] 19/7/2019 12:01

As a result of most of the dry bulk global fleet now operating in the spot market, the strong recent performance of the BDI is beginning to feed through into the valuations/market performance of quoted dry bulk ship owners/operators and diversified shipbrokers, whose market valuations traditionally lag strong upward movement of the BDI by 3-6 months.

[mount teide] 19/7/2019 10:36

Another day another new 5 year high for the Baltic Dry Index which continues to power ahead, surging a further 66 points(3.2%) today to reach 2,130 - extending its incredible winning streak to 22 days in 23.

The BDI is up an astonishing 100.5% over the last 23 days, +257.9% from the Feb 2019 higher low (CAGR of 619%), and +614% since the H1/2016 shipping market cycle recession low.

The good news? The BDI is still today trading at barely 50% of its 10 year inflation adjusted mean and just 18% of its inflation unadjusted previous market cycle peak

Highly irritating that despite repeated requests over the past three years to the management of IG and other CFD and Spread-bet service providers to offer a product for investors to directly trade the BDI, we are still yet to see such a product.

As posted on the JTCod thread in H1/2016 and again at the Feb 2019 higher low - going heavily long the BDI then after it bottomed respectively circa 98% and 95% down market cycle peak to trough, was as close to a one way bet that the markets have probably offered in decades.

[tudes100] 18/7/2019 23:44

Downing have been talking for a while about changes to the board so clearly institutional holders were not very happy.

[alfred] 18/7/2019 08:37

I imagine we need to thank the Chairman for this development.

[edmundshaw] 18/7/2019 08:17

Fingers crossed. A good appointment could be the (re-)making of Braemar here.

[spooky] 18/7/2019 08:09

Kidwell going has to be a major positive IMO.

[mount teide] 18/7/2019 08:02

CWA - there are, but whether any of them are likely to be approached is another matter.

[cwa1] 18/7/2019 07:50

Thanks for the BDI updates as ever.

Are there any obvious candidates out there for replacing the CEO IYO?

Cheers

[mount teide] 18/7/2019 07:42

Hi CWA - Another day another new 5 year high for the Global Shipping Industry Index that measures the demand/cost of moving commodities around the world - over 90% of all dry commodities see the inside of a bulk carrier's cargo holds at some point between the producer and buyer/consumer.

The Baltic Dry Index continues to light up the afterburners by surging a further 53 points(2.63%) today(following yesterday's 4.3% rise), to reach 2,064 - extending its incredible winning streak to 21 days in 22.

The BDI is up 94.3% over the last 22 days, +246.8% from the Feb 2019 higher low (CAGR of 592%), and +591% since the H1/2016 shipping market cycle recession low.

Wonder what the Shipping Market 'Guru's at Zero Hedge make of it all?
The BDI has moved up 246.8% since ZH published an armageddon call for the shipping industry and global economy in mid Feb - ZH's call completely ignored the fact as i posted at the time that:

* There were easily researched seasonal(Chinese New Year shutdown) and short term one-off factors (extreme weather events hitting Australian export Ports and causing the Dam Collapse at one of Vale's largest Brazilian Iron Ore mines) behind the sharp drop in the BDI in early Q1/2019 which had nothing whatsoever to do with the health of the global economy.

* the global economy has expanded by an average of circa 2%-3% a year for over 40 years with just one slightly negative year,

* the long term highly cyclical shipping industry only bottomed in 2016 after a brutal 8 year 98% peak to trough downturn/recession, recklessly created as a result of a greed driven industry generating a massive shipping overcapacity issue during the last market cycle recovery/boom phase (2000-2008) - which at its spot market peak saw the annual cash flow generated by a Capemax dry bulk carrier virtually equal the build cost of a new vessel with a 25 year commercial life.


Factors that are collectively influencing the current strong upward movement of the BDI include:

* Supply, demand, and prices of bulk dry commodities.
* Supply and capacity of global dry bulk fleet
* Health of the world's economy and overall market sentiment.
* Crude oil prices and the resulting cost of bunker fuel.
* Preparation for the implementation of the IMO 2020 Shipping Fuel Regs
* Seasonality in the transport of commodities.
* Port congestion
* Geopolitical events, labour issues, weather, and accidents in exporting and importing countries.

[mount teide] 18/7/2019 07:18

CEO finally falls on his sword - hopefully for shareholders the company will secure a Shipping Industry professional to replace him.

[cwa1] 16/7/2019 08:21

Morning MT. Thanks for posting the BDI figures and stats. I know they are publicly available-but I don't watch them as closely as I perhaps should, so it is useful, to me at least, to see them. So thanks and keep it up if you have time and inclination!

[mount teide] 13/7/2019 11:15

The Baltic Dry Index set another 5 year high today, surging a further 49 points(2.70%) to reach 1,865 - extending the winning streak to 18 up days in 19.

The BDI is now up 75.6% over the last 19 days, 213.4% (CAGR of 514%) from the Feb 2019 higher low and 525% since the H1/2016 shipping market cycle recession low.

[psync] 11/7/2019 07:50

Hmm, cantor downgrade yesterday due to debt and earnings uncertainty.

hxxps://www.tradewindsnews.com/finance/cantor-fitzgerald-cuts-braemar-shipping-services-with-lumpier-earnings-forecast/2-1-635894

Tempted to (belatedly) throw in the towel here.

[mount teide] 08/7/2019 14:30

Baltic Dry Index extends its winning streak to 15 days adding another 40 points (2.35%) today taking the index to 1,740 - a rise of 20.3%(294 points) in three days(101% of the 2016 market cycle low!).

The index is now up an astonishing 63.8% over the last two weeks and 192.4% from the Feb higher low, while the FTSE 100 has returned +5.9%.

The BDI is now within 33 points of setting a new 5 year high and 660 points of a new 9 year high - looking a little toppy perhaps?

Despite the very strong run the BDI is just 14.7% of the previous shipping market cycle inflation unadjusted high set in 2008 of 11,800 points, when 350 metre long Capemax Bulk Carriers earned $240,000 a day on the spot market with circa $12,000 a day operating expenses. Capemax charter rates bottomed some eight years later in H1/2016 at circa $4,000 a day and were below operating expenses for almost all the 5 year period between 2012 and 2017.

[wigwammer] 07/7/2019 12:30

"The market does not agree with you.." not sure that's true mt, but congratulations with the performance of your other investments. The performance of long term underperformers on low valuations tends to be better than the alternatives. This has been statistically proven across multiple markets and time periods, and forms the statistical basis for value investment. Problem is it can take a long time before it comes right and many don't have the patience for it. Happy to stick it out here, and wait for fundamentals and sentiment to turn, but I understand it could be a long wait. GLA :)

[mount teide] 05/7/2019 14:16

Baltic Dry Index lights the afterburners!

The BDI extended its winning streak to 14 days with an incredible 9.75%(151 point) increase taking the index to 1,700.

The BDI has risen 17.6%(254 points) in two days - that's 85% of the 2016 market cycle low!

The index is now up an astonishing 62.2% over the last 14 days and 185.7% from the Feb higher low, while the FTSE 100 has returned +5.9%.

Highly irritating that despite a number of requests over the years to IG and others, no spreadbet/CFD service provider is yet to offer a product enabling direct trading of the BDI.

[talygarn tom] 04/7/2019 18:48

Companies are valued on their future earnings and the potential stability of those earnings within their sector.If Apple's earnings fall in consecutive periods its share price will fall irrespective of its past performance. Market leaders can get it wrong and go bust just like any other company. If you want to consistently buy shares on higher than average earnings multiples be my guest.

[mount teide] 04/7/2019 13:13

'Past performance is not a guide to future performance.'

The market does not agree with you - it thinks past performance is usually a pretty reliable guide, that's why it gives much higher valuation multiples to successful companies and market leaders with a long history of consistently outperforming their peers.

[talygarn tom] 04/7/2019 12:52

Past performance is not a guide to future performance.

[talygarn tom] 04/7/2019 12:52

Past performance is not a guide to future performance.

[mount teide] 04/7/2019 12:32

tt - the valuations of highly successful companies like Clarksons have a long history of remaining at elevated levels for a very good reason: they have a long history of outperforming their peers.

'Buy at the bottom and sell at the top?'
Why not just hold onto a high performance company investment?

£10,000 Invested in Clarksons and Braemar 19 years ago would now be worth (excluding dividends):

BMS - $9,760 with an annual dividend today of £789
CKN - £252,400 with an annual dividend today of £7,500

[talygarn tom] 04/7/2019 11:38

I'm sorry for your loss but I think you're both on the wrong board - wink wink. Do Clarkson have a page on ADVFN?

Clarkson shares are too expensive. Everyone is aware of the issues Braemar have faced and having mitigated their exposure to the tanker and oil service sectors and their smaller size is the exact reason why BMS is now likely to outperform Clarkson over the medium term. Buy at the bottom - sell at the top and all that.

[cwa1] 04/7/2019 10:44

Thanks for taking the time to post your thoughts MT, appreciated.