Monday, 05/19/08
Posted 05/19/08,  9:01 pm ET

(Scroll down to see Jim's comments below)

 
 
Today's date:  Monday, 05/19/08

  Dow Jones: 13,028  + 41
  NASDAQ:   2,516  -  12
  S&P 500:   1,426  +  1
 
 
 
 
 
First Segment
 
Final Segment 1 Title: 'Bulk Shopping'

.  .  .  .  .

Featured Stock(s): Star Bulk Carriers Corp. (SBLK)

See SBLK's official website here.

See the Yahoo! Finance profile for SBLK here.

Paragon Shipping Inc. (PRGN)

See PRGN's official website here.

See the Yahoo! Finance profile for PRGN here.

 

 
After this segment, you can see Jim's Sudden:Death picks here...

.  .  .  .  .

JJC:   Tonight, I've got not just one, but two... two catch-up stocks that have been overlooked, while the bigger fish in the sector have soared higher!...

I'm talking about two opportunities in... remember this group... the dry bulk shipping group.

This is where you take grain, or iron ore, or coal... and you just dump it in the ship, which is different than the oil tanker or container ships.

Since the bottom on January 17th, Excel Maritime (EXM) is up 87%... DryShips, Inc. (DRYS) is up 101%... They got hammered today. It's your opportunity...

These are two big dry bulk shippers with growth, but not much in the way of dividends. I'm not recommending them tonight.

Then there are three big dry bulk shippers with hefty dividends... Genco Shipping (GNK), Eagle Bulk Shipping (EGLE) and Diana Shipping (DSX)... On average, they're up 91% since January 17th...

That's two doubles, and three near doubles...

But there's a group within dry bulk that's been left behind... one that I think is ready to play catch-up with its peers... the smaller of the dry bulk carriers... the under-sponsored ones... the ones with market capitalizations under $1 billion...

I'm talking about two that you want to write down, because I think they're about to roar with the rest of them... and they are...

Paragon Shipping Inc. (PRGN) and Star Bulk Carriers Corp. (SBLK)...

Now, these guys... I mean, not too shabby... they've come up 43.8%, since January 17th. I know... these gains are unbelievable, but not compared to the others... These gains are half the size of the other dry bulk shippers. To me, perfect catch-up material...

Why such a huge discrepancy?...

Well, I think, for one... the hot money goes to the better-known... the spot focus growth plays like Excel Maritime (EXM) and DryShips (DRYS). Those are pretty much the proxies... Or they go to the yield plays, Genco Shipping (GNK) and Eagle Bulk Shipping (EGLE)... And, since the larger companies have more ships, their more levered to the bullish cycle in dry bulk shipping, and more levered to the Baltic Dry Index, that everybody follows, who follow these companies closely.

The other issue is that the smaller companies are mostly contracted out for 2008 and 2009. I think that creates the possible perception that there's less upside in the stocks, because there's less earnings upside for the companies.

But, now, look at from the perspective of someone who owns one of the larger dry bulk carriers, and has just made a huge amount of money... or, even better, someone who missed the move... Maybe you missed the move...

You see, these smaller dry bulk plays, like PRGN and SBLK... they haven't moved up nearly as much as some of the larger plays, so people who are looking for more trades among the dry bulk shippers, will be gravitating to these two...

Hey, and they've got great yields...

SBLK yields 9.5%. PRGN yields 9.1%... for now. And, like many of the shippers, those dividends can fluctuate... and I think fluctuate to the upside, because of rates.

PRGN, which has 11 ships in its fleet, has the capacity to grow its fleet by 3 ships in the near future. Hey listen, that matters, it's very hard to make ships right now... And, any announcement that they've got the new ships should be great news for the stock... as more ships generally means more cash flow. And you need the cash flow to support the existing dividend, or future dividend increases...

These boats do not cost nearly as much as the rates (i.e., the dry bulk rates they are paid for transporting their cargo) they're getting, so whatever they're costing is far exceeded by how much they're bringing in. Plus, PRGN has two more ships left to reset charters on this year... meaning two more ships that aren't already chartered out and locked in at a lower price...

PRGN secured an average rate increase of 25% for the four other ships that they've reset charters on this year and, if it gets similar increases from the last two ships... (they will likely) increase the dividend...

.  .  .  .  .

SBLK is the other small, dry bulk play...

The company has already bought two ships this year, adding them to the fleet, and it probably could afford to add one more... SBLK is fully booked in 2008 so, therefore, you're not going to get the higher rates. But it could re-charter ships, not covered, in 2009, to possibly justify paying a higher dividend. Remember, you get higher rates, you get a higher dividend... That's how these ship companies work... they give the money right back to you.

.  .  .  .  .

Now, while I like both of these, I am by no means backing away from Cramer-fave - and the one we've used the whole time - Frontline Ltd. (FRO), which ships both crude oil and raw materials... and it hit a 52-week high again, during today's trading... a monster move, up $3 bucks.

I also like Nordic American Tanker (NAT)... where the CEO says the market is the strongest he has seen in 30 years of shipping...

.  .  .  .  .

The Bottom Line!:      Many of the larger dry bulk carriers have already doubled, or come close this year...  But Paragon Shipping Inc. (PRGN) and Star Bulk Carriers Corp. (SBLK) have been left behind at the dock.  I don't expect that situation to last long.  So, I recommend lending a hand sooner, rather than later. 

 

   
 

Stock Snapshots - Includes all stocks mentioned above

 

 

Jim
Cramer's
rating on
this stock

STOCK
SYMBOL

Closing
price
that
day

Opening
price
next
day

Full Company Name/Comments
(see comments above for each)


SBLK

13.70

na

Star Bulk Carriers Corp. (SBLK)


PRGN

20.57

na

Paragon Shipping Inc. (PRGN)


FRO

65.96

na

Frontline Ltd. (FRO)


NAT

40.35

na

Nordic American Tanker (NAT)

 

 

 



See all of tonight's stocks' latest quotes on Yahoo! Finance



Most popular
investing books ordered:
(click any book to see at Amazon.com)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 

 

 

 

 


  We need your help! 
If you find our service valuable, your donation is critically helpful to support
our operating costs and is MUCH appreciated!
(click below to donate)

We are serving thousands of new visitors every day and our costs are growing as well.  Thank you for your support & generosity!


 

 

 

 
 
 
 
Second Segment
 
 
Final Segment 2 Title: CEO Interview:
Herbjorn Hansson, CEO

.  .  .  .  .

Featured Stock(s): Nordic American Tanker (NAT)

See NAT's official website here.

See the Yahoo! Finance profile for NAT here.

 
After this segment, you can see Jim's SUDDEN:DEATH picks here >>

        
Jim's Comments BEFORE the interview:         We've been talking tankers.  I've got to tell you something... the tanker market... very hot.  We've been using Frontline Ltd. (FRO)...  The last couple of weeks, we've been saying Nordic American Tanker (NAT) makes sense.  A lot of what I get about tankers comes from the individuals who run these companies.

No one has been more accurate, nor more bullish than Herb Hansson.  He's the chairman and CEO of NAT...   He has been keeping in touch with me, telling me when we've got a turn... he called them exactly.  Herb... good to have you on the show!... 

.  .  .  .  .

Jim's Comments AFTER the interview:      All right, NAT going higher... what can I tell you... you heard it from the man.   Hey... by the way, the man is really good.  When the rates were going down, he was bearish.  The guy is saying get on board... I'm going with him!

 

.  .  .  .  .

 

   
 

Stock Snapshots - Includes all stocks mentioned above

 

 

Jim
Cramer's
rating on
this stock

STOCK
SYMBOL

Closing
price
that
day

Opening
price
next
day

Full Company Name/Comments
(see comments above for each)


NAT

40.35

na

Nordic American Tanker (NAT)

         
 

 

[ end of final segment ]

   
 

Go to the SUDDEN:DEATH SEGMENT from tonight's show here >>

See current quotes on Yahoo! Finance from tonight's show stocks here >>


Netflix, Inc.


Symbol keys:

A Charitable Trust stock. - An asterisk next to a stock symbol indicates that Jim mentioned it is a stock that he manages within
his charitable trust portfolio.  You can see the complete portfolio
of stocks here >>

Thumbs up - indicates he would buy the stock or, at the very least, not sell the stock.  We do our best to interpret Jim's opinion on stocks, as we think it is indicated by his comments during the show.  Please read his comments to decide for yourself.

Thumbs down - indicates he has said not to buy or to sell the stock, based on his comments  We do our best to interpret Jim's opinion on stocks, as we think it is indicated by his comments during the show.  Please read his comments to decide for yourself.

Back up the truck - indicated by Jim, when he says the stock is so good, that he would do a 'mon-back' on the stock... In other words, this is the sound someone would say to a truck driver, "Come on back... " as he is "backing up the truck" to load up on his cargo.  Translation for buying stocks:  This recommendation by Jim indicates that, after you do your own homework on the stock, you should feel comfortable loading up on it, as it is in a good position to be bought at this point.

Stumped. - Of the 2,000+ stocks that Jim Cramer has in his head, for which he has an informed opinion, he sometimes comes across a caller with a stock he does not know well enough to opine on...  He then indicates he is stumped and will have to come back to it, after he does some homework of his own on the stock.  This usually occurs during the Lightning Round, when Jim does not know in advance who is calling, or what their stock question is about.
 

 
Definitions of key phrases used by Jim, known as "Cramerisms":

Definition:   'Pull the trigger' is Jim's phrase for making the decision at that point to trade - either to 'buy' or to 'sell' (although he usually uses the phrase for buying), as if to say you should feel comfortable enough to make the final decision without looking back...

Definition:   'Ring the Register' is Jim's phrase for selling a stock, and making it a final sale, that you should not look back on.  Put it behind you.

Definition:  'Let It Come In' indicates how you may wait for it to pull back, or have the stock price come down briefly, as your chance (after letting it come in) to buy the rest of your position (i.e., total number of shares you own in that stock).

Definition:  'backing it up' or 'doing a 'mon-back' is Jim's phrase for the metaphor of backing up a truck to load up on a stock by buying it.  'Mon-back is short for the imaginary worker saying, 'Come on back...' as the truck is backing up to receive its load... Notice that we use the little truck icon to indicate where Jim has mentioned this.  Translation for buying stocks:  This recommendation by Jim indicates that, after you do your own homework on the stock, you should feel comfortable loading up on it, as it is in a good position to be bought at this point.
  See more "Cramerisms" & other financial phrases here >>
   
Helpful Websites:
  See the stocks currently known to be in Jim Cramer's
Charitable Trust at:

jim-cramer-charitable-trust-stocks.com

 
See the stocks currently known to be in Warren Buffett's portfolio
of stocks at:

warren-buffett-portfolio.com

 
  Stock Homework 101:   This is an excellent upcoming site that provides resources and links to help you do that homework that Jim Cramer recommends after hearing his suggestions...

StockHomework101.com

This site is coming soon.   Thank you.

 
  FastMoneyRecap:   This site will be a quick summary of recommendations made by the great Fast Money TV show crew, that will offer you a unique service, to compare their picks to Jim Cramer's past comments about those stocks.

Fast Money Recap - Trades for next day...

Compare these picks to Jim's comments for the same stocks.

 

 

   
   
  © 2005-2007 MadMoneyRecap.com ■ Important disclaimer: This site is not affiliated with Mr. James Cramer, and is not associated with any television networks or broadcasts. Please note that all thumbs up or thumbs down indicators are not always clearly indicated on the show and are interpreted by us as accurately as possible. Some comments have been edited for brevity and clarity, and extraneous material omitted.  Please rely on watching the show yourself, doing your own homework, and reading the text of the comments to draw your own conclusions. Also, data presented on this site should not be used to make investment decisions and accuracy, although attempted, cannot be guaranteed.  Please consult with your own financial advisor for professional advice.
 
 

 

 
       

Feedback   ■   Terms of use   ■   Privacy Policy  ■   Keep this site Free