Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, drybulk vessel owner Baltic Trading (NYSE: BALT ) has earned a coveted five-star ranking.
With that in mind, let's take a closer look at Baltic's business and see what CAPS investors are saying about the stock right now.
Baltic facts
| Headquarters (Founded) |
New York, N.Y. (2009) |
| Market Cap |
$247.5 million |
| Industry |
Marine |
| Year-to-Date Revenue |
$0 |
| Management |
Chairman Peter Georgiopoulos
President/CFO John Wobensmith
|
| Cash/Debt |
$59.26 million / $10 million |
| Dividend Yield |
5.8% |
| Competitors |
DryShips (Nasdaq: DRYS )
Eagle Bulk Shipping (Nasdaq: EGLE )
Excel Maritime (NYSE: EXM )
Navios Maritime Holdings (NYSE: NM )
|
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 98% of the 147 members who have rated Baltic believe the stock will outperform the S&P 500 going forward. These bulls include wtnewell and the top-ranked stock picker in all of CAPS, bullishbabo.
Earlier this month, wtnewell described Baltic in bullishly basic terms: "A long term play, based on the long term economic recovery."
For the uninitiated, Baltic was established by another highly rated shipper, Genco Shipping & Trading (NYSE: GNK ) , to take advantage of cheapish vessel prices. When you combine the $228 million raised by Baltic in its March IPO, with the $75 million contribution from Genco, Baltic seems well-capitalized to do it. In fact, our community is drawn to the fact that Baltic's balance sheet, for now at least, is substantially cleaner than highly levered rivals like DryShips, Eagle, Excel, and Navios. Throw in an already industry-topping dividend yield, and the Genco-managed Baltic is certainly worth looking into.
CAPS leader bullishbabo elaborates:
When I look for a shipping play, I look for (1) age of fleet, (2) debt levels, (3) profitability, and (4) valuation. I think Baltic Trading fits the bill. Let's examine more closely:
1. Age of fleet: The fleet is new.
2. Debt levels: There is no debt currently, although a small amount may be forthcoming.
3. Profitability: I've seen the way Genco manages its ships, and they are skilled in managing vessel operating expenses. With a new fleet, I'm certain that Baltic Trading will operate above break-even for a long time. A new fleet and no debt lead to low maintenance costs and non-existent interest expenses.
4. Valuation: As I said above, the ships were purchased at a good price and you get a further discount from the IPO price. ...
Baltic Trading is the true pure play on the [Baltic Dry Index]. I realize major economic recovery could take years, but I'm content collecting the $0.16 quarterly dividend, which works out to a 5.84% yield on my basis price. Major economic recovery will see a soaring BDI, which in turn will see Baltic Trading trade at a much higher price.
What do you think about Baltic, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!
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