In light of the “Value Investing Conference” taking place in NYC today, my urinal shadow just gave me a presentation as to why shares of OSG are heading higher. It was rather convincing, and strikingly similar to David Einhorn’s short thesis on CMG, but in reverse.
In summary, he feels “the odder boat companies, see, just plain suck.” He also states that he “spits on the fucking graves of that bitch Diana (DSX) and Drydicks (DRYS).”
Fact of the matter is, the Baltic Dry Bulk Shipping Index (BDI) is down more than 55% for the year, an extreme exaggeration of perverted distortions. Armageddon is priced in and the BDI is poised to bounce.
As you can see, a bounce is underway.
On this bounce, I expect the shippers to catch a bid, whenever the market decides to trade up again. Saddled with a huge short position and the very worst priced in, OSG will see better days ahead.
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