First off, BALT acquired two new Capesize vessels today, upping their fleet to 13 (4 capes, 4 supramax, 5 handy size). I love the deal and feel BALT in keenly positioned to profit from a rising BDI, more than any other publicly traded company, due to their solid balance sheet and age of fleet, which stands at an industry low of just 3.6 years.
As you know from an earlier post, I acquired shares of RBCN today, based off the GTAT-AAPL arrangement.
Sapphire is a commodity and will trade higher, as supply gets taken off the market. The fact that Apple is paying GTAT $500+ million dollars for sapphire supplies means this is a big deal. I believe it will be used for screens, which will force competitors, like Samsung, to follow suit. Due to the exclusivity of the GTAT deal, the only other supplier of note left is RBCN. I view this in the same vein of how the industry shifted to flash memory, away from DRAM. Early buyers of SNDK were richly rewarded.
The plain truth: sapphire is a superior material to gorilla glass. As an aside, companies like ZAGG will go away, once sapphire is adopted, since it’s scratch proof.
I bought my RBCN position at the opening tick and have an average cost of $10.06. I didn’t mind paying up because I feel the stock is heading to $20, if not higher. With 35% of the shares sold short, bears are in for a house of agonizing pain for the foreseeable future.
It’s also worth noting that the decline in WTI is outpacing Brent, also bullish for refiners like ALJ, DK and WNR.
I am +2.5% for the day so far.
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FIG.
I’m long BALT, but I’m not so sure how I feel about the new ships. They just raised $63.5M @ $4.60/share to get their balance sheet in order, now they’re dropping $103 million on 2 capesizes and levering up again. If this rise in BDI turns out to be temporary, that’s going to hurt a lot more.
Yes, but a great man once said “no balls, no babies.”
At 20k per day, following a 50% drop in Cape rates, I like this deal.
Indeud. I’ve just been watching the sector and BALT in particular for the last few years and was sort of expecting the sustained rise in rates to happen mid-2014ish as the oversupply of ships worked itself out with retiring of older ships & the shippers with poor balance sheets going bankrupt. BALT’s still very well positioned with the youngest fleet around and not locked into any long term contracts like the others, best way to play the sector unless you think DSX is going to start acquiring the struggling shippers for pennies on the dollar with their cash hoard.
A wise man once said “Have to spend money to make money”. I think this move says more about their confidence in shipping industry going forward than anything. And that is a good sign for any of us invested.
pretty baller fly
In for some RBCN too. in Fly I trust.
when do you pick out your Rick Ross music video of the day?
At the bell
Hat tip on BALT & GTAT!
YRCW partridge ride today … horrible POS of a company… oh well as long as it pays me 🙂
YRCW = score…
FLY how do you like GIMO?
Like it
YELP 100 before 2014 back on the table
We have topped, beyond topped on this stupid market and EU isn’t going to give us the Cocaine some think it will this week. Mario today talked about EU Banking Union, which is in Germany’s Hands and not his. Once the Cocaine is gone, so is this market. Anyway, For the BDI, China is saying that their next qtr will be slower, China Rebar Prices down again, Snow is coming…no rally in BDI Shipping rates even with the CEO earlier this week from I think NMM, all hot for a raising rate on their conf call. NOW, what is interesting is the Iran Sanction Meeting on THursday, I believe that CHina is close to being in violation of those sanctions because they can only buy so much from Iran. Gossip is that a deal could finally come, which will nosedive Brent and kill Refiners, but that is just me. And nobody reads my stuff so it doesn’t matter.
You are so wrong its actually quite funny. Short at your own peril.
To add, bubbles and tops are only called by people who are not positioned correctly.
Nope, Historically our markets move from Bubble to bust. So we are always inside a Bubble Formation or a Bust reaction. We are at extreme Overbought conditions at this point.
The market can stay irrational longer then your portfolio can stay solvent. Don’t try and be a hero, catch good stuff and raise stop losses.
That Statement was made by Keynes that was long on Margin in a falling market. fyi.
It’s your money, I’m just pointing out that we are nowhere near retail exuberance that usually comes with a top. And, breadth of this year, is in the top 5 of all time. that usually means we have a lot more to go, cocaine or not. FYI …and Keynes is the man.
Phish at MSG ticket re-release for all you dirty hippies, I jsut picked up the ones I didnt have yet.
I started using more chess analogies in my trading strategy. not really working