In today's edition, industrials editor and analyst Brendan Byrnes discusses Dryships' recent disappointing earnings. The results showed the same story we've been seeing for a while -- a strong Ocean Rig subsidiary coupled with continuing weak and declining dry bulk segment. Drybulk revenue declined 33%, not surprising considering the Baltic Dry Index is getting close to the level that it bottomed at in 2008. Dryships will likely opt to put more ships on the spot market as the company waits for long-term rates to recover. Overall, the dry bulk industry continues to suffer from a severe overcapacity problem. Ironically, the company's Ocean Rig subsidiary is benefitting from the opposite situation. Drilling rigs are in high demand and low supply right now, and Ocean Rig is performing well and is booked for nearly all of 2013. Still, the poor drybulk industry dynamics combined with a historically shareholder-unfriendly CEO and a scary balance sheet leads Brendan to believe that this is a stock long-term investors should avoid. Check out the video below for more.
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