Globus Maritime Share Discussion Threads

[slapdash] 28/8/2008 07:43

looks ok... interim dividend of about 6.7%..i.e. about 27p.... probably ahead of expectations... dividend goes ex on 5th September

current dividend yield about 13.3%...

time charters 65% of 2008 fixed and 25% of 2009... so they are relatively unfixed on forward rates compared to some other companies... they are looking to fix up at the appropriate time..

P/E after dividend paid and assuming stock price of 405p... is 3.7X this year and 3X next year's earnings...

we shoudl be careful here as all depends what P/E a cyclical company deserves and how long one assumes freight rates will remain high.. some forecast a collpase in frieght rates sometime in late 2009 as more ships are delivered to the market...

Also I think what distinguishes GLBS and the other recently listed shipping companies is that they do have gearing which might exacerbate the downside...

Saying all this 3X next year's earnings might be said to offer good protection in terms of a relatively low valuation...

Any other thoughts?? In case of interest one can view the commentaries for Eagle bulk shipping and Drybulk on the website Seekingalpha.com - One of these companies states that it believes Q4 this year will be strong for frieght rates... hard to get a feel for how these U.S. companies are rated as there are so many one-off in their results... however GLBS does have a much higher dividend which might indicate it is relatively cheaper but might just reflect a higher pay-out ratio..

Slap

[slapdash] 22/8/2008 15:48

no doubt the share price will remain dead as a do do... ruddy credit crunch...slap

[deadly] 21/8/2008 23:03

There's your answer.

[slapdash] 12/8/2008 09:47

so when are the ruddy results!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Slap

[slapdash] 17/7/2008 11:09

this just seems unbievably cheap to me...... yield now of 12.8% this year and 15.6% next year.... and these figures could easily be beaten...

so in two years your divi return is 28.4%....

Earnings may be lower in 2010 but given the dividend taken out the forward P/E will be even lower for that year....

Just seems ludicrously undervalued.... yes other companies have high yields but this is twice covered and it has forward visibility due to ship chartering.... secondly, it is in a sector that is growing and benefiting from increasing world trade.... thirdly, it should be a beneficiary of the credit crunnch.

Slap

[slapdash] 14/7/2008 11:57

Go With The Flow - more trade is a secular trend and as explained before the credit crunch actually benefits this sector as it reduces the supply of ships...

Also BDI is very strong.... finally they are locked in for the rates they get for sometime so dividends for this year and next should easily be payable...

Besides which dividends are 2X covered....

Slap

[go with the flow] 14/7/2008 11:39

Slapdash - fine in theory but what if they cut the Divi?

Also credit crunch affect consumer confidence, less purchases affect manufacturing (next sector facing impact of banks/financials crisis) therefore less manufacturing input = less resources needed = less shipping!

Flow

[slapdash] 11/7/2008 11:23

Yield about 12.5% this year and 15% next year...

if we say they payout half of EPS and the P/E this year is about 4.2 and next year about 3.3.... so holding for two years gives a dividned return of about 27.5%....

not too bad... also BDI is holding up well... credit crunch will have reduced credit for more ships.... thus BDI should stay stronger for longer...

Slap

[gepetto] 30/6/2008 15:04

There should be more PI migrating over from GOC (taken private) until August. I'm one of them with just under 1k shares.

[alter ego] 30/6/2008 13:43

wcj, welcome aboard. I hope you enjoy the voyage.

[robsy2] 30/6/2008 10:29

yep .I'm back in here. I sold out last month I needed the money but have used the proceeds from GOC to retake a position here.Can't see any downside from this one, the income stream looks predictable for the next 18 months or so , the divi is excellent and a potential bid is thrown into the share price for nothing.
We might get lucky!

[slapdash] 27/6/2008 15:10

hopefully one for GLBS will be in the post too.... does make you wonder as at this valuation you could buy the company for a premium and then have paid back teh acquisition costs in under five years just from profits...

Slap

[davebowler] 27/6/2008 11:36

Takeover for Goc

[alter ego] 19/6/2008 09:57

slapdash, I don't think week to week movements in freight rates are too important. Only 3 of 8 ships are on spot and these are under negotiation for two year time charters. cannot imagine the rate agreed will be other than a significant improvemnt on previous rates. IIRC estimated eps of approx £1 were based on an average daily rate for the fleet of $33k. We know that the fleet has been averaging over $39k so FWIW my view is that a 50p dividend is looking easily achievable. DYOR of course.

[slapdash] 18/6/2008 10:58

bought some today... spread a killer... but appears like good entry point given that P/E for this year is about 4.5X and next year 3.4X....(these fall down further after the hopefully 5% interim dividend)... calender forward p/e about 4X... dividend this year say 10% and next year say 15%....

yes freight rates are off a lot but they had a strong rise beforehand...

So it is a gamble as who knows where frieght rates will be in a year's time.... but I think this is a reasonble one...

however, we will have to wait for interims in September I guess.... as these companies don't exactly produce much newsflow... dividend then should be nice.. also we may see earnings surprises on the upside come September given the strong freight rates for the second quarter...

it all comes down to what risk-premium investors put on this sector... (I don't blame the market for a high risk premium given how freight rates can collapse in a matter of months).....and when (probably not if) freight rates do fall back markedly (hopefully a few years out given credit crunch has reduced ship buying/building)... in any event if we get the 25% dividend for the next two years then that is 25% of our money back...

Slapper

[slapdash] 14/6/2008 09:57

either way I think we may get a buying opportunity here as this is so illiqued I could see it down below £4 on negative sentiment and momentum... that would appear to me to be a great entry point.... but boy is hte BDI volatile... question is how low will it go now...just before the start of this year it lost 50% in a couple of months.....

Slap

[alter ego] 13/6/2008 17:12

slightly different outlook later in the year - take your pick

[slapdash] 13/6/2008 15:30

analyst predicts BDI will fall for the rest of this year.... China orders yards to stop stockpilling ironore...

just looked at the GLBS fleet and they have three handmax ships coming up for re-charter at Q4 this year all at a rate of about $22,000 per day... HCL recently chartered a Handymax for $45,000 per day.... so that should bode well one would of thought... although BDI does look set for drop off..... Courant any thoughts??

My thinking is that it starts to look very cheap with another 10% off the stock price.... but they are in teh spot market with a lot of their ships so one needs strong nerves...

I also worked out that per dry tonne weight they are more expensive than HCL... but if the stock price goes below £4 that will change.....

slap

[slapdash] 10/6/2008 09:51

this is so illiqued just a few sales puch it down...

ironic really as they are the one with quite a few ships on the spot market...

I think it could do well after full year results.... i.e. when the market actually sees the money!!!!!!!!

slap

[robsy2] 23/5/2008 17:52

Hi Slap and Alter
You know what I am getting at , your right , the shippers are also shovellers of cash at the moment.The capital aspect is intersting because finance is hard to come by and more expensive than it was.

For me the cyclical nature of the industry is the key to the low rating.Recently there has been an upswing in demand.There is a lot of demand for shipping now so thats good for business.The missmatch of demand is intense at the moment.This will correct itself maybe violently at some point. but it doens't really worry me with ratingas of PER5 on rock solid earnings for 2008,2009 .

I would think that those involved in chartering ships should be able to hedge their positions going forward so locking in great profitability/ fixed known input costs. This could change the traditional cycle.
Nice weekend all
Robsy

[alter ego] 23/5/2008 14:05

doesn't the lower rating reflect the fact that ship owners have a lot of capital tied up in depreciating assets which will one day need to be replaced? Meanwhile, those assets yield a variable return based on freight rates so forward visibility of earnings is less predictable.

[slapdash] 23/5/2008 13:11

Rosby2 - I would of thought GLBS and GOL are also "shovel makers" or at least the suppliers of shovels.. the boom here is in commodities and they supply the ships to move them around... In any event I think the analogy really applies to the speculative end of things... i.e. the speculative oil and gas/mnining companies versus the firms that make the equipmetn for them...

What I am really trying to assess is why these companies have lower ratings than other firms in the same sector but non-ship owners... I assume it must be because the other companies have earnings which aren't as dependent on freight rates staying high as they can also do well on volumes.... i.e. BMS, Clarkson etc.... the low rating here must be saying something???

Slap

[robsy2] 23/5/2008 13:04

Slap
I heard an old saying once along the lines of " If theres a gold boom on sell shovels" i.e. Everyone needs a shovel , only a few will find gold.GLBS and GOL are finding lots of gold as it were and I have positions in GLBS and GOC and am happy to ride that one out because the ratings are so low, plus the ownres of these businesses are able to smooth out the cycle. In terms of shovel sellers we have BMS where they seem to be making great progress, they get lots of income from broking.Clarkson could also be of interest.

[slapdash] 23/5/2008 09:53

Courant and others - I had a few thoughts on these stocks recently. Firstly, we might expect GLBS to beat its forecasts given charter rates. Secondly, it comes to the debate of quality of earnings. The ship owners appear like the better play given foward chartering and therefore earnings visibility. However, one could probably argue an alternative view. The brokerage and shipping related companies are benefiting from an increase in the number of ships (size of market) and not only freight rates. The increase in the size of the market might insulate them from a downturn in frieght rates more than for the pure shipping companies where it is only about frieght rates.

Any thoughts... good chartering from HCL today...

slap