DRYS Inc. (NASDAQ: TRIES) stock is up more than 40% from layearsear. It shows many of its shipping colleagues. The solid flow of stocks is partly driven by improving financial performance. However, even a year from now, DRYS at https://www.webull.com/quote/nasdaq-drys is going to be something that cannot be changed. Here’s what it means and what it means for investors.
Things are getting better
DRYS lost 85 0.85 a share in 2017, but it should remain firmly in the black in 2018. In the first nine months of the year, shipping concerns have earned approximately .1 0.16 per share. From that perspective, you can understand why investors are rewarding the stock at a higher price.
It is based on revenue improvement in the two major segments of the company. DRYS was able to charge its entire shipping group, for example, more than 60% per year in the first nine months of 2018. Rates in the tanker business were over 65%. These two businesses make up about 75% of the company’s total revenue. Although rates in the company’s gas carrier fleet were nearly flat, it added new ships and increased revenues from the segment to about $ 3.3 million to $ 31 million.
The DRYS has clearly benefited from the improvement in the shipping business and the expansion and diversification of its fleet. On the surface, there is a lot to like here, which means that this stock has performed very well over the past year.
However, you have to back off a little more to see the full picture with DRYS. Go back three years, and suddenly the stock has almost lost its value. Last year’s rise comes from a total decline in the share price. It changes things in a big way, and a major cause of that decline is not going away any time soon. While the company continues to benefit from improved shipping costs next year, it is far from a given in the highly cyclical and economically driven shipping business.
The truth is, it doesn’t matter what happens to ship charges from here – dry ships don’t belong to most investors. The important story goes back to 2016 when the heavily indebted company was facing a cash crunch. CEO George Economo provided the cash infusion. It also sold shares to a third-party investor. In all, it has access to $ 400 million.
Instead of paying off debt, the company began expanding its fleet. Revenue growth in the natural gas business mentioned above is one of the big effects of this expenditure. However, DRYS was buying more than gas carriers. Spending on fleet growth was higher in 2017, and rates increased in 2018. For more stock news like Nyse big, you can check at https://www.webull.com/quote/nyse-big .