| Eagle: Flying on raw materials |  | Digg It! |
| Tuesday, 02 October 2007 | |
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“A recent quote from Bloomberg sums it up: ‘Dry bulk is on fire. If you put a dry-bulk tanker away (on contract) for three years, you get 20% returns. For crude it's 12%,’ said Omar Nokta of investment banking firm Dahlman Rose & Co. “The rising cost of hauling bulk commodities such as coal, grain, fertilizer and iron ore is great news for your shares of Eagle Bulk Shipping Inc. (EGLE), which are posting 65% gains. Also boosting shopping costs are bottlenecks at key ports around the globe. “I first recommended EGLE last November, and this latest news is very bullish. What's more, the consensus estimate for the company's third-quarter earnings per share is currently 38 cents -- 52% higher than the same quarter last year. For the full-year, earnings are estimated to clock in at $1.35 per share. “I wouldn't be surprised to see these estimates bumped higher in the coming weeks, and I wouldn't be surprised to see EGLE beat the estimates, sending these shares even higher. “Plus, let's not forget that EGLE pays out a nice quarterly dividend. The last dividend (47 cents) was paid out on August 7. It equals a 7.6% yield. Not bad! |
“Booming raw material consumption in China and India are boosting shipping costs and benefiting Despite strong gains in recent months, natural resources advisor Larry Edelson continues to recommend Eagle Bulk Shipping (NASDAQ: EGLE) and Nordic American Tanker (NYSE: NAT) in his Real Wealth Report.
While Eagle Bulk is up 44% since his initial buy in November, he says, "There's plenty more potential packed into this trade." During the first quarter, he notes, the company agreed to acquire three Supramax vessels. And, he adds, the firm has expanded its building program to four new Supramax vessels.
What's more, says Edelson, EGLE just paid out a 50 cent quarterly dividend (equal to a 9.16% yield). He states, "With red-hot demand in Asia for just about every commodity under the sun, EGLE's fleet is likely to stay booked, and profits should rise. That's great news for shareholders."
Along with Eagle, the advisor also likes Nordic American Tanker, another tanker company that has risen 26% over the past six months ago. NAT charters its fleet of Suezmax oil tankers, he notes, and will continue to benefit from "the world's insatiable appetite for the oil."
He adds that Nordic American also also pays out a "sweet," quarterly dividend equivalent to a 12.76% yield. If not on board either of these positions, he says, buy them now at the market.
