Please ensure Javascript is enabled for purposes of website accessibility

Why Diana Shipping Stock Kept Rising on Monday

By Rich Smith - May 24, 2021 at 3:32PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Q1 wasn't great for Diana, but it was a lot better than it might have been.

What happened

Shares of dry bulk shipping company Diana Shipping (DSX -0.83%) stock are likely to book a second straight (trading) day of gains Monday, with shares up 8% as we head into the final hour of the trading day.

So what

Diana stock closed out last week strong, as you may recall, rising 7.9% after reporting better-than-expected fiscal first quarter 2021 sales of $41.1 million and better-than-expected "earnings," too. (Actually, Diana lost money for the quarter -- but only $0.03 per share where Wall Street had forecast a $0.06 per-share loss.)  

Sales declined 6% as compared to last year's Q1, but only, management explained, because the company sold four of its ships and consequently had fewer vessels to utilize. However, Diana made better use of the ships that remained as fleet utilization climbed to 98.6%.  

Combined with higher "time charter equivalent" rates on dry bulk cargo (up 0.5%) and lower expenses (down about 4%), this translated into a much smaller loss for the quarter.

Three quarters view of a dry bulk cargo ship on a waterway.

Image source: Getty Images.

Now what

Management did not provide specific guidance for what to expect over the rest of this year, but analysts are optimistic. According to consensus estimates, Diana will continue shrinking its generally accepted accounting principles (GAAP) losses in Q2 ($0.03 per share expected) and continue to grow its revenues (predicted to be up 15%). By the time the year ends, analysts expect to see Diana close out this year with a net profit of $0.05 per share -- and full-year revenue growth of nearly 21%.  

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Diana Shipping Inc. Stock Quote
Diana Shipping Inc.
$5.95 (-0.83%) $0.05

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/09/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.