Seeking Alpha • Nov 02

Eagle Bulk Shipping: Patience Should Pay Off

Summary Eagle Bulk Shipping is a Connecticut-based shipowner and operator specializing in the global transportation of dry bulk goods. The company reported a net income of $18 million in Q2 2023 and declared a cash dividend of $0.58 per share. I can't be sure we'll get an EPS beat this time either, but I think this event definitely has a higher probability than is currently priced in. Despite inherent risks in the shipping industry, I maintain a "Buy" rating on EGLE stock due to a positive industry outlook and potential for higher dividends. Read the full article on Seeking Alpha

Seeking Alpha • Aug 28

Eagle Bulk Shipping: A Complicated Story In A Volatile Industry

Summary Shares of dry bulk transporter Eagle Bulk Shipping Inc. are the subject of considerable intrigue, after 28% were repurchased at a 19% premium to their prior close on June 22nd. The move was to fend off a potential hostile takeover from container shipping concern Danaos Corporation after it had been revealed that it had acquired a 10% stake (now 16.7%). With Eagle’s stock $17 per share lower than the price it paid to (then largest stakeholder) Oaktree Capital, the recently instituted poison pill to fend off Danaos merited further investigation. A full investment analysis follows in the paragraphs below. Read the full article on Seeking Alpha

Seeking Alpha • Aug 07

Eagle Bulk: Cheap Bulker With Decent Dividend

Summary Eagle Bulk is a US-based dry bulk ship owner with a fleet of 52 modern vessels. The company is a dividend stock with a reasonable valuation, but carries risks related to its debt. The development of the dry bulk freight rates imposes challenge in the future. Read the full article on Seeking Alpha

Seeking Alpha • Jun 25

Eagle Bulk Shipping: A Bargain Trading Well Below Net Asset Value

Summary Eagle Bulk Shipping is trading at a trailing 12-month yield of 9.6%. Eagle Bulk Shipping is a US-based corporation (incorporated in the Marshall Islands) with no related party transaction problems and very low debt. Eagle Bulk Shipping is trading well below reasonable liquidation value, which is probably north of $60 a share. The dry bulk shipping sector has probably bottomed out in terms of rate levels, making this an excellent time to buy. Read the full article on Seeking Alpha

Seeking Alpha • Jun 18

Eagle Bulk Shipping: Danaos Corporation Reveals 9.99% Stake - Buy

Summary Eagle Bulk Shipping's shares are down by almost 20% since my recommendation three months ago due to a precipitous decline in dry bulk charter rates in recent weeks. The company reported seasonally weak Q1 results but provided an improved outlook for Q2 with the dividend likely to benefit from an up to $17.0 million gain on vessel sales. Upsized credit facility provides additional financial flexibility. Leading containership lessor Danaos Corporation has quietly accumulated a 9.99% stake in Eagle Bulk Shipping in recent months. Buy Eagle Bulk Shipping on discounted valuation, strong balance sheet and liquidity, superior corporate governance as well as promising industry fundamentals. Read the full article on Seeking Alpha

Analyseartikel • Mar 09

Eagle Bulk Shipping Inc. (NYSE:EGLE) Looks Inexpensive But Perhaps Not Attractive Enough

When close to half the companies in the United States have price-to-earnings ratios (or "P/E's") above 16x, you may...

Analyseartikel • Feb 24

We Like Eagle Bulk Shipping's (NYSE:EGLE) Returns And Here's How They're Trending

If we want to find a potential multi-bagger, often there are underlying trends that can provide clues. Firstly, we'll...

Seeking Alpha • Feb 23

Eagle Bulk Shipping: A Mid-Sized Vessel Specialist With An Edge

Summary Among the companies specializing in the mid-sized vessel category, EGLE is the company with the largest fleet. The company has been able to hold 70% of their Q4 TCE per day fixed at very similar rate as in Q3. EGLE scores higher on profitability ratios compared to its peers, making it an attractive choice for investors looking to invest in this sector. Based on an EV/EBITDA valuation, EGLE stock is currently undervalued at around 40% compared it its peers. We rate it a buy based on this ratio. Introduction and Background Eagle Bulk Shipping Inc. (EGLE) is one of the leading companies within the mid-sized vessel dry bulk shipping universe. They have an impressive fleet of 54 fully owned vessels, including 26 Supramax and 28 Ultramax vessels, EGLE has positioned itself to be a top player in the mid-sized vessel dry bulk shipping universe. Their fleet is the largest of its kind among its closest competitors, making them a standout choice for investors. The size of its fleet is not the only attribute that sets EGLE apart from its competitors- it is the strategic focus on mid-sized vessels. By specializing in this vessel type, EGLE is equipped to transport all major and minor bulk types, allowing them to withstand declines in demand for any commodity. Additionally, 48 of their vessels are fitted with scrubbers. Due to this, EGLE can generate additional value and fuel savings. Supramax/Ultramax: Most Versatile Asset Class (Eagleships.com) The average age of their fleet is only 9.5 years, as such, EGLE is well-positioned to be a top player in the dry bulking industry for years to come. Furthermore, EGLE has an attractive EV/EBITDA ratio at its current price, which is why we rate this stock as a buy. In addition, it's worth noting that EGLE's vessels are equipped with onboard cranes. This allows the offloading of cargo without the need for on-shore port equipment or infrastructure. This is a distinct advantage for a company in the dry bulk shipping industry. Risks and Market Outlook As we previously alluded to in our post about Star Bulk Carriers (SBLK), the dry bulk market has faced and will continue to face many challenges in the short term. These risks include a continuous decline in the Baltic Dry Index ((BDI)), fluctuations in Chinese demand, rising operating expenses, and tensions between China and the US. When we examine the BDI, we immediately notice that the current levels are not far off from those observed during the pandemic in the spring of 2020. Additionally, the BDI has experienced a decline for eight consecutive weeks, with no apparent signs of an impending reversal. BDI Chart (Stock Info) Some may argue that the BDI is close to or has bottomed. However, the short-term trend has strong downward momentum with no apparent signs of slowing down, as can be seen in the chart above. The only obvious catalyst for the BDI is an increase in Chinese demand, which could soon become recognizable in the data. However, the effects of the Chinese reopening can take several months to come to fruition. As such, it could take some time before we see a significant increase in demand from China. As seen in the figure below from, almost 40% of the volume in the dry bulking sector was destined for China in 2022. Thesignalgroup.com In case China will start to increase its imports in the future, it could only be a matter of time before we start seeing the BDI increase again. However, we should not expect to see the same levels as we saw back in 2021 since we do not have the same global supply crunches and these aren’t likely to come back anytime soon, as this was a one-off event caused by Covid-19 lockdowns. Another important geopolitical event to be aware of is the current friction between China and the United States. With the recent balloon affairs, tensions between the two superpowers are relatively high, and we could see economic retaliation from both nations in the form of tariffs. Tariffs usually suppress demand and could hinder a return to a normalized Chinese market, as we saw back in 2018 and 2019. On a global scale, the IMF projects emerging markets and developing economies to grow by 4% and 4.2% in 2023 and 2024, respectively, with the global economy growing by 2.9% and 3.1% in the same years. Growth should very well lead to an increase in dry bulk commodities. EGLE: Setting Sail Into A Profitable Fourth Quarter As we pointed out in our previous article about Star Bulkers Carriers Corp., the whole industry suffers from a significant decline in TCE which is having an effect on the revenues within the dry bulk industry. Meanwhile, operating costs have significantly increased, dragging down company profits. This is mainly due to the fact energy cost has increased after the Russian invasion of Ukraine, as well as rising commodity prices causing maintenance of their fleet more costly. TCE rates per day (fearnpulse.com) Readers of our previous article will be familiar with the chart above, where we see that TCE rates have declined and are now at a level that we haven’t seen since late 2020. The TCE is either bottoming out or in case of a recession we could see a further decline. Although the TCE has declined over the past year, EGLE has kept its TCE relatively consistent between Q3 2021 and Q3 2022, while its OPEX + G&A has only increased slightly. This can be crucial for their Q4 earnings, which will come out in just a few weeks, on March 2nd. TCE and Operating Costs YoY growth (Stock Info based on company reports) The costs and TCE is also shown in EGLE's Q3 2022 presentation, with a slide from the presentation presented below: EGLE Revenues and Cost Performance (eagleships.com) In addition, they have managed to fix 70% of their voyages for Q4 2022 at an average rate of $25,040, well above the Q1 2021 level. As shown in Figure 4, TCE prices have fallen well below $20,000. Therefore, securing 70% of their TCE at such a high price will likely be profitable for EGLE. Furthermore, EGLE sees the Supramax and Ultramax global fleet growth slowing in the coming years, which can be seen in the chart below. Expected Net Mid-Sized Fleet growth for 2023 and 2024 (EGLE Q3 earnings presentation) As the growth of the dry bulk shipping fleet does not align with the global increase in demand, there is a possibility of a slight supply crunch in the years to come. As a result, it could lead to higher TCE rates and a potential return to the dry bulk paradigm observed in 2021 and 2022. Investors interested in dry bulk shipping should take note of this, as it could indicate profitable times ahead. In summary, the dry bulk shipping industry has experienced a significant decline in TCE rates and increased operating costs, leading to a decrease in company profits. However, EGLE has kept its TCE rates and operating costs relatively stable, which could lead to good Q4 earnings. Additionally, with the growth of the dry bulk shipping fleet not aligning with the global increase in demand, there is potential for a supply crunch in the coming years, which could result in higher rates and, thus, better returns. Financials Eagle Bulk Shipping has had a two-year period with incredible growth on its top line, with a constant positive YoY growth every quarter since the beginning of 2021, as seen in the table below. EGLE Historical Financials (Stock Info based on SEC filings) Over the past 8 years, EGLE has been able to show consistent growth in its revenues. But, the company experienced some difficulties in 2019 and 2020 – understandably so given the macro fundamentals at this time (slight economic downturn on a global scale in 2019 and COVID-19 in 2020). Nevertheless, based on the TTM estimates, 2022 is expected to be an 8-year high for the company in terms of revenue, free cash flow, operating income, and operating cash flow. Unfortunately, there are a few things not to like about this growth. Their operating margins have decreased slightly since 2021. This is still well above 40%, which can be considered more than satisfactory. We don’t see this as a significant issue. If we look on a 5-year basis, EGLE has 5-year revenue CAGR of 26.04% and a 5-year operating income CAGR of 168.05%. These are both very attractive numbers for potential investors. However, it is expected that in 2023 the growth will come down slightly due to the factors mentioned above and confirmed by this IMF report. EGLE has taken measures to slow down their capital expenditure significantly since 2021, with capital expenditure now at the same level as in 2016. We believe this is more than likely in anticipation of a global economic slowdown or even a possible recession in 2023. As mentioned before, this money has been prioritized to bolster their balance sheet instead. Comparing them to their closest competitors on several profitability metrics, you can see why we prefer EGLE over other companies in the dry bulking sector. Profitability Metrics for EGLE and Peers based on Q3 2022 Numbers (Stock Info) EGLE's margins are just over the average compared to its competitors, which does not necessarily stick out but is well within the realm of good results. The standout metric for EGLE is their impressive FCF yield, which, based on their Q3 2022 earnings, is calculated to be almost 42%. In addition, its EPS outperforms its competition quite clearly, which should appeal to possible investors. Another rather appealing metric of EGLE truly shines in their ability to generate returns on their assets, equity, and investments compared to their competition. Looking at table 4, the reader will see just to what extent EGLE triumphs over its competitors. Profitability Ratios for EGLE and its Competitors (Stock Info) Again, EGLE seems to be a more attractive company when we compare it to its peers based on ROE, ROA, and ROIC. We believe EGLE should be included in an investor’s portfolio if they are interested in exposure to the dry bulk market. Given the desirable profitability ratios, you can see that EGLE is the most attractive among the mid-size specialized dry bulk shipping companies. Furthermore, given that they are currently trading at an EV/EBITDA ratio of 2.43, with the average among the included companies being 3.48, EGLE is presently trading at a 43.5% discount compared to its peers. Thus, we believe this stock is a buy based on the aforementioned EV/EBITDA ratio.

Seeking Alpha • Feb 02

Eagle Bulk: Midsize Dry Bulk Market Update (Podcast Transcript)

Summary Value Investor's Edge Live returns in 2023 with an exclusive interview focused on the dry bulk segment of the shipping industry. Gary Vogel, CEO of Eagle Bulk, joined us on 17 January 2023, to discuss the latest trends in the market along with specific company strategy and capital allocation priorities. We reviewed the impacts from the conflict in Ukraine and the expected demand surge from China reopening into 2023. Capital allocation: Additional bolt-on acquisitions along with potential convertible bond repurchases. Dividend payout levels will depend on market conditions in 2023. A full audio recording (with time-stamps) is attached along with a transcript. Listen and subscribe to the Marketplace Roundtable on these podcast platforms: iTunes/Apple Podcasts Spotify Stitcher Seeking Alpha Gary Vogel, CEO of Eagle Bulk (EGLE), joined J Mintzmyer on Value Investor's Edge Live on Jan. 17, 2023, to discuss the dry bulk markets, upcoming catalysts, company strategy, and capital allocation plans. Eagle Bulk is a major US-listed dry bulk shipping company with an on-the-water fleet of 54 vessels. EGLE was a strong dividend payer in 2022 along with impressive market rates and has been able to consistently outperform market averages due to a superior fleet profile and chartering strategy. This interview and discussion is relevant for anyone with dry bulk investments or interest in the overall sector, including Diana Shipping (DSX), EuroDry (EDRY), Genco Shipping (GNK), Golden Ocean (GOGL), Navios Maritime Partners (NMM), Pangaea Logistics (PANL), Safe Bulkers (SB), Seanergy Maritime (SHIP), and Star Bulk Carriers (SBLK). Topics Covered (0:00) Intro/Disclosures (1:45) Update on the current midsize dry bulk markets. (4:15) Remaining impacts from the Russian invasion of Ukraine? (6:00) Expected impacts from China’s reopening in 2023? (7:45) Disconnect between bullish narrative and lackluster FFA markets? (10:15) Why not buy FFAs directly if bullish? Update on hedging strategy? (15:00) What are the biggest risk factors for the midsize bulk markets? (17:45) Appetite for repurchases to benefit from stock discount? (20:15) Commentary on convertible bonds, how to resolve? (23:15) Appetite for more bolt-on fleet additions? (25:15) Current profit contribution from scrubber spreads? (28:45) Dividend plans in 2023? Will it decrease now that rates are lower? (31:45) How to balance fleet growth versus discounted share repurchases? (34:15) Why should investors buy EGLE vs. other dry bulk firms? Full Interview Transcript J Mintzmyer: Good morning, everyone. Good afternoon if you're joining us from Europe. We're hosting another exclusive interview at Value Investor's Edge, hosting the CEO of Eagle Bulk, Gary Vogel, who's going to join us today to talk about the midsized dry bulk markets as well as Eagle Bulk's strategy into 2023. We're recording on the morning of January 17, 2023 about 10am Eastern Time. As a reminder, nothing on the call today constitutes official company guidance or investment recommendations of any sort. I have no current position in Eagle, stock symbol (EGLE); however, if you're listening to a recording or reading a transcript at a later date, please be advised these positions may have been updated. Good morning, Gary. Thank you very much for joining us today. Gary Vogel: Good morning, J good to be with you, and Happy New Year. JM: Happy New Year to you as well, and it's always great to chat about the markets with you. I want to jump right into it. You're here today as the expert in the midsize dry bulk market. You know, 2021 was a fantastic market. 2022 started off really strong and the last six months have been pretty challenging. What's the latest update on the market and how are you feeling about things heading into 2023? GV: Yes, well - look, I think it's important to pull back a little bit and look, and no doubt our markets peaked during the second quarter and kind of worked their way down. Having said that, the Q4 market averaged $15,000 for the Supramax Index and it's worth mentioning that the Supramax Index, the BSI, is based on a 58,000 deadweight ship, now more than half our ships are Ultramaxes. We also have over 90% of our fleet fitted with scrubbers, and we deploy an active management strategy. So you know, although the market came off its very lofty highs, you know, the $15,000 average in Q4, especially coming from a higher number, is not exactly the most challenging environment that I've experienced being, you know, 34 years in dry bulk. So where we are today, clearly it's January, we're less than a week before the Chinese New Year. So not surprising we're in a weak environment. Having said that, last year with these weaker numbers and I'll put that in quotes and why I think weaker really not surprising. It's the second time since 2000. So in 22 years, we've only had two years where dry bulk demand didn't grow on a ton mile basis. The last time was during the financial crisis, really based on a drying up of trade credit. And then last year and this past year, we had negative ton mile growth, around a little over 1% contraction. Not really surprising given that we had China in significant lockdowns. Our growth came in about half of what was expected at the beginning of the year. We have a war in Europe, of course, Russia/Ukraine. And then on top of it, we've had significant tightening in monetary policy globally. So when you look at all those things, I think the markets held up remarkably well, and I think it speaks to, you know, really the constraint on the supply side. JM: Yes, thanks, Gary. I'm really glad you brought up China and you also mentioned Ukraine, because those are just, I think, great places for us to do some follow-ups. Let's talk about Ukraine first. That's obviously been a crisis the last year after the Russia's invasion last February. I know, grain shipments have been disrupted. There's been sort of a truce as it were for those grain shipments, but I know there's still been a lot of uncertainty. How has that impacted the market last year and is there a chance that's going to be different here in '23? GV: Yes so, you know, aside from a humanitarian crisis that this poses, you know, grain shipments we're down about two-thirds. And so one of the reasons is, we had effectively the first two months normal grain shipments and then of course you know February is when the war started. You know fortunately, this grain carter, this agreement has really helped in a meaningful way. But again, we still lost two-thirds of shipments. A lot of that is expected to be - well, first of all, hopefully a continuation of exports of grain, although they've mostly moved on older and smaller ships. But our expectation is that grain will grow by about 3% next year or this year, excuse me, we're now in '23. I got to get used to saying that, but that we think grain will grow - grain volumes will grow this year partly, because we think China reopening and demand for soybeans, including restocking on inventory, but also there's been planting going on elsewhere and we expect a record crop in Brazil. So you know, positives for grain overall is that - again plus you know around 3% this year, which is meaningful for one of the major bulks, especially an important one for Eagle Bulk. JM: Yes certainly, certainly a change. I mean, going from a clear headwind last year into what seems like a high likelihood of a tailwind in '23 so that's optimistic, that's good to see. What about China's reopening can you expand upon that a little bit more? Are you expecting to see additional cargoes in coal and iron ore or is this primarily a grain and soybean story? GV: No - absolutely, it's positive with the headline China reopening can only be seen as positive. Having said that, we have to be realistic as to what's going on. And of course, we see headlines or I should say, maybe slowly news, you know, and data coming out of China, but as you know, not surprising, you know significant, you know COVID outbreak given the immediate overnight, you know, opening and lifting of restriction. So you know, China reopening is really positive, but it's not going to be an immediate you know light switch. And so, you know, we think this is going to be really a great story for dry bulk as China comes back. I mean China's 40% percent of total dry bulk demand globally. And as I mentioned, growth was expected to be almost double where it came in last year. So that's got to be really positive. The question I think more is how quickly that happens. And yes, we think there'll be a restocking of not just soybeans, but you know, minor bulks in general - and thermal coal as well. JM: Yes, the logic of what you're saying, Gary, makes sense. And I had a similar personal reaction to China reopening and you know, looking at the trade flows, it certainly makes sense. However, if you look at the dry bulk FFA markets, especially the [Cal 23s], you can look at different sizes. Capesize are the most pronounced, but you can look at basically all the sizes. And you see this peaking last April or May, right, of '22? And since then, yes, we had a little bit of a bump when China reopened and announced all that stuff, but those FFAs are really depressed. What do you think is holding those back? What's the, disconnect between kind of the bullish narrative that you and I are talking about versus the sort of subdued mediocre narrative that the FFA markets are showing? GV: Yes well, first of all, I've been trading FFA is now since the BSI came into, you know, being or at that time was the [antimax index] over 20 years. And one thing for sure is that, you know, the forward curve is a bad predictor ultimately of where rates end up. And I think you don't have go back very far, you know, to see that. You know one of the, you know, reasons right now it's hard to see when that demand comes and we're in a very weak environment. Having said that, the BSI, the strip, as we call it, the Q2 through Q4, is trading around 14,000 now significantly positive to where it is today. And I think you'll see that continue to improve on the other side of Chinese New Year. So again, I wouldn't - put too much into where it is. It's often, you know, it lags on the upside and even same on the downside, right? People, you know, they tend not to get this enough momentum ahead of time and then they're slow to correct. So, we're very constructive and the biggest reason is, as I've said, notwithstanding those headwinds last year, you know, the market overall, you know, did quite well. And what we're looking at on a macro basis, right, is historically low order book, you know, at just over 7% and a rapidly aging fleet. I mean, we really haven't had scrapping you got to go all the way back to 2016 when we had kind of normalized scrapping. And last year, only nine midsized geared ships were scrapped last year that's out of a fleet of 4,000. And so, we've had almost no scrapping and real discipline on the supply side. So we think when we get growth back against this supply side market, you know, it's really, really, you know, strong, you know, combination and I think it's going to be reflected in the rates. JM: Yes again, it certainly makes sense, Gary. And I have a similar view. I don't have the same FFA trading background that you have, but I've seen a similar thing in the lack of prediction of the FFAs. They seem to always be a little bear biased as well and I imagine that's due to hedging and that sort of thing. One of the retorts I get though, and I think it's a good comeback from, you know, investors or folks who are skeptical when you know, I might say, hey, you know, the outlooks - bullish, but the FFAs are bearish. People say, well, if it's that easy, then why don't we just buy FFAs why just trade those? Any commentary on that, Gary, is there any interest in Eagle expand on that? GV: Sure, yes, absolutely. I mean first of all, we as Eagle, we don't just go ahead and buy FFAs. We have a very strict policy that our use of derivatives is hedging physical assets always against the name physical asset. And with now 54 ships pro forma for the acquisition we announced about a week or so ago, we're naturally very long-term market even with cargo. So our natural position is to sell FFAs, so we can't just go and buy it. Having said that, we do charter in ships and we like that also, because it gives us optionality for the same reason we don't like to relet our ships on time charter where you're giving away significant optionality in terms of the actual period in which the charter can redeliver the ship. We like to be on the other side of that, you know, as we like to say pretty simple options, you know good to get, bad to give. And so, we do charter in ships, but we're not buyers of the FAA market. We just have a very strict a requirement that we have a physical asset and needs to be a hedge. Having said that, I'll just add I think you know this, but we're not shy about actively, you know, unwinding those hedges and putting them back on. So although, we don't take what we call a negative derivative position to the market, if we think that the FFA market if we put a hedge on and when we think that market is dislocated and then cheap, we may buyback that hedge. And leave the asset unhedged for a moment and then put it back on as there is volatility and dislocation between the physical and the derivative markets. JM: Yes, certainly makes sense, Gary. Thanks for that. And I was going to follow-up on this later, but since we're already on the topic of FFAs, you had about 25% of your fleet hedged previously during the stronger markets. And of course and hindsight, you know, it was disappointing because the market was so strong even though the hedge was good. You talked about you're interested in unwinding when that looks attractive. Can you just provide any sort of update on your current strategy, your current positioning of the company in those markets? GV: Yes, so look, I can't speak to specific positions if you look back the last time we disclosed our FFA position was September 30th, and at that time we had sold 22 contracts, I believe it was, you know, we had 22 contracts as of Sep 30 for December 3, which is you know, a pretty meaningful part, you know, part of our of our fleet. And we had bought back 14 of those. It's all in our Q. So we had eight open positions as of that time and the average was 22,000. And as I mentioned earlier, on this call, the market average 15. So obviously, those at that time we were in the money, but I can't speak to how we may have traded them, but, you know, not surprising with a weaker FFA market, you know, now around 14,000 for Q2, Q3 and Q4 this year, we're not very excited about selling that market in a meaningful way. When we sold the '22 market, it was in a much different environment. And again, all of these numbers are to BSI without things like scrubber benefit and our overall position and things like that. So, you know, without again, I can't get into specifics it's fair to say that, you know, we're going to be more active in hedging and locking in revenue streams in a higher market environment than in a lower one. Having said that obviously, if we were negative to the market, we might be more aggressive, but I've already said, we are constructive to this market and January is historically the weakest month of the year, so we're not that surprised about where we are. And I'm sure you'll get to the balance sheet, but I'll bring you there really quickly. As of Sep 30, we had almost $200 million of cash and $100 million undrawn revolver. So, you know, this weakness in the market, you know, while I'd rather be sitting here and talking here in a $25,000 day market in January, you know, we're comfortable, very comfortable where we are and we see there's an opportunity here for us to buy quality Ultramax tonnage at significant discount to where it was just six months ago. JM: Yes, thanks, Gary. And before we get to the balance sheet and a little bit more capital allocation nuanced. I did wanted to ask, we have such a bullish narrative here, and you know, I think a lot of folks are in alignment with that, especially if we look forward to middle of the year, later in the year, right, once we get past this core seasonality. But what are the risk factors what are the biggest concerns about 2023? What could cause this to be a poor, if not terribly? GV: You know look, I think the macro environment, you know, geopolitical risk and the overall macroeconomic environment. Supply is really baked for the next two and a half years that you'll see some orders for '25 still, but in Japan, you're looking at 2026. And although prices have come down a bit, they're still expensive and of course, cost of debt today is a lot different than it was just 12 months ago. So I think it's really on the demand side, and I think that's again, speaks to, you know, geopolitical and macroeconomics. And so, you know, everyone, of course, has to will have their own view as to where we are there. But last year was pretty negative for dry bulk and in terms of the demand side of things and I think the market held up relatively well. And I spoke to the fact that we just haven't had scrapping, for some reason this market were to stay weak for the next six months. I think you'd see a significant supply side response in terms of dry bulk ship scrapping, which of course will be good on the supply side. But as it stands today, you know, the - age of our fleet of the - you know, the dry bulk Handymax fleet is almost 11 and a half years, and you got to go back all the way to 2009 since the last time it was at that level. And at that time, you know, the order book was over 75% of the on the water fleet, and today it's 7. So could we have a choppy Q1 into Q2? Yes, I think that's given all of the exogenous factors going on right now? Yes, but - if you pullback, you know the supply side and the lack of scrapping and the fact that we've had 20 years of ton mile demand growth in dry bulk, I think it bodes really well for this market. JM: Yes, we'll certainly hope for more optimistic outcomes, it's just you know, obviously, remains to be determined, and we'll have to see how things shake out. It is interesting to see, of course, China reopening the grain shipments looking to turn into a tailwind. And yet if you look at the rates, if you look at the FFAs, folks are way more bearish now than they were last April or May. So that - it's just a very interesting dichotomy and we'll have to see how that turns out. You mentioned the strong balance sheet and a huge cash provision? I certainly agree with that. Despite that - despite that strong balance sheet, you trade at a discount to NAV at this point. And that's despite having a fleet that has a high proportion of scrubbers, very strong corporate governance, a history of shareholder returns, right there's all these positive factors and yet there's still a discount in the shares. Is there any potential for repurchase here to close that gap or any other sort of way to accretively deploy capital? GV: Yes, so, I think you are aware we bought back 10 million phase value of our convert towards the end of last year, and so I think that speaks to our willingness. We have a share buyback authorization, but given that the covert is selling the money, we really see [indiscernible] the convert as kind of a quasi-share repurchase. I mean at some point between now and the maturity which is in the middle of 2024, you know we’re either going to have to issue shares on the convert or write a check or a combination of both, you know in terms of redeeming those, and so to the extent we can reduce that liability through covert buyback opportunistically we have done it in the past and we definitely are always looking at it. You know the one we did it last time our shares, it was a moment of weakness, if you will, and the shares were trading in the low 40s. So, we opportunistically did that. And so, and we'll continue to look for those opportunities. Having said that, putting cash on the balance sheet for that ultimate redemption we think makes sense. It also gives us optionality in terms of acquiring assets as we continue to do. So, as I spoke about our constructive view of the market, I mean, we already mentioned it or spoke about it briefly, but we've acquired a couple of Ultramaxes over the last few months. The last one just announced a couple of weeks ago. So, we're walking the walk. In terms of that, we believe in the fundamentals of this market and which is why we're going to continue to add modern and in particular scrubber fitted tonnage when we can, you know to the Eagle Fleet because we think this is a bit of a momentary thing and that ultimately the fundamentals are going to prove to be, you know, really positive for the for the market. JM: I'm glad you mentioned the convertibles Gary because that's something we closely watched and it seems like that's a potential for a win-win because you're both eliminating future dilution at a point, which could be below NAV, and at the same time, you're buying back debt, right? So, it's not just, you know, it's deleveraging and eliminating some dilution. Is there potential for more of those? Could we see some sort of resolution? Because it seems like right now those convertibles, and I know we've talked about this in the past, Gary, but it seems like these convertibles are still, kind of an overhang. GV: Yeah, I mean, to what extent, you know, an overhang, you know, it's up to individuals. I think our shares perform very well relative to the peer group and especially on a TSR basis. Having said that, it's another point of discussion, right? If we didn't have a convert, we wouldn't be spending time on this call right now. You know, speaking about it. So, you know, that in of itself, I think, you know, speaks to it. Yeah, there's definitely a possibility that we'll do more and maybe something larger. Having said that, I think the last time we spoke about it, I mentioned we may do something and then we did the 10 million. So, it's going to have to be, you know, watch this space, but it's definitely a possibility. And as I said, you know, the benefit of, if we don't do something by having cash on the balance sheet, we always have the ability to do so and ultimately, you know, add maturity, and you know, you always have to pay, you know, some premium and especially with more time based on the option value there. So that goes away over time as you get closer to maturity. So, even if we don't do it now by stockpiling cash on the balance sheet, I think it speaks to our ability to do so. And as you said, you know, at the time of execution, which could be at maturity, you know, if we're trading at a discount to NAV and using cash is accretive and something that we would look to do if not in full, then in a meaningful part. JM: Yeah. That’s certainly helpful and optimistic to know that you have the option to just pay those down in cash because I think folks are worried about if there'd be a dilution and it's one of those things where I understand why you had the convertible in the first place, right? It was attractively priced debt. It made sense at the time. But the wind up of those is always a little bumpy. I mean, Scorpio Tankers is going through their own little bump in a road with their convertibles. And there's always a trading mess around those things. I realize the purpose of them, but there's always a little bit of mess at the end. GV: Yeah. Look, I mean, no question. If we go back though at the time, equity, we were looking to acquire scrubber fitted Ultramaxes in 2019. And equity, even if we could have done, it would have been incredibly dilutive and at a big discount. And we just weren't willing to lever up the company to the point where we had to. So, the converts played it, you know, they were the right tool at the right time. But, you know, we're now, you know, 3.5 years into it and as you said, you know, at some point, you know, it's going to have to be, it will be taken out. It's just a question of how and when. JM: Certainly. You had a couple of very interesting acquisitions recently. I guess you'd call them bolt-on deals. You added two ships recently. Is your potential for more than two here or how many potentially might Eagle be interested in? GV: Yeah. The answer is, absolutely. I think over the last number of years, we've acquired 31 ships and sold 20 vessels are older ships. You know, we now all have only one ship that's older than 14 years old, which is shipped that's almost 18 years old and as we've spoken before will likely be sold before our next statutory drydock. So, we're now in a position although fleet renewal is never there because ships keep getting older. We don't have any pressure on the rest of our fleet other than that one ship. And when I say pressure, self-imposed, we simply believe that in general we want to operate ships up to 15 years, but we don't have any other vessels that we need to do anything. So, unlike before when we're referring three ships we brought in when we're selling two, now as we acquire ships, we'll be able to grow this business and I think there's benefits to scale that we've spoken about before on the capital markets side, as well as on the balance sheet side and operationally. So, we will look to acquire, continue to acquire ships. If we can do them in multiple groups, that's great, but if not, we've demonstrated, we're happy to do them one at a time if we need to. We're not going to pay a premium for a group of ships, but, you know, and we just don't think there's real value in that. So, if we have to acquire them one at a time, we will. And the other benefit of doing that is, you know, cost averaging, right? And that is not trying to exactly time the market, but buying ships over. So, I'm not going to put a number out there, but I think our balance sheet shows that we have the capacity and you combine that with our constructive view of the market and I think it's fair to say that you'll see us continue to add modern Ultramaxes, particularly – ideally scrubber fitted to when we can acquire them, you know, between kind of 2 and 6 years old, 2 and 7 years old. JM: Certainly how does the scrubber play into that? What sort of, because my understanding is the current spread is around 200 and 220 something around there, how does a scrubber fitted vessel differentiate itself in terms of, like, savings per day? GV: Yeah. It's pretty straightforward and it's really a separate calculation. So, it's not that we think that only, you know, scrubber fitted ships are good and without a bad at all, but it's a separate piece of equipment and separate income stream, which is nice because aside from the positive value in a weak environment, it de-risks your breakeven. Because as I said, it's a separate income stream. So, you know, the spot right now is just under 200, you know, which is around $2,800, $2,900 per day on a Supramax or an Ultramax. You know, the forward curve is a bit weaker at about 140, but still that represents around $33 million of EBITDA and net income additional outside of basic ship earnings. So, right now as I said around $2,800 per day, and in 2022, the spread average just [239] [ph] actually, and that equates to [indiscernible] basis around $57 million of incremental revenue for Eagle Bulk on an investment of just over $100 million. So the scrubber investment has really shown its strength in 2022 and even in the current environment, something like $33 million or sorry, $45 million on that investment on our follow-up year is quite demonstrative. So, we’re very comfortable and pleased with that investment decision. JM: Yeah. Certainly. It's hard to, it's hard to overstate how accretive that investment has been and it’s just such a layup. So, I'm glad you did that and it's certainly interesting going forward. I'm personally surprised that the spreads have hung out this high. I mean, we're – my latest quote on a big 4 [indiscernible] was 220 spread, $220 per ton. And, you know, I was bullish on Scrubbers, but I am shocked to see the spread above 200. Do you have any broad thoughts on that spread? Is there anything driving that? Any sort of insights or just kind of price takers at this point? GV: Well, we have locked in those spreads at times, right now, not too similar to the FFA market. We think it's a little – it's over [backwardated] [ph]. And part of part of it, our view for that is because there's a high correlation between underlying crude pricing and spreads. And if you look at our investment presentations or earnings deck, you'll see we overlay the spread against, you know, underlying, you know, brand crude, and you can see how closely or how high the correlation is. And so, we think there's a lot of reasons why energy prices will likely increase with China reopening, and that's why we're definitely not looking to lock in spreads at the forward backwardated numbers. We think the spot numbers are good value. And again, spot equates to around $45 million on an annualized basis for Eagle Bulk.

Analyseartikel • Jan 31

Is It Too Late To Consider Buying Eagle Bulk Shipping Inc. (NYSE:EGLE)?

Eagle Bulk Shipping Inc. ( NYSE:EGLE ), is not the largest company out there, but it saw a decent share price growth in...

Seeking Alpha • Jan 25

Eagle Bulk's Fortunes Are Likely To Turn Soon

Summary Shipping rates have come down but aren't likely to head further lower. Global shipping volumes aren't going to fall off a cliff. Valuations are too cheap to ignore.

Seeking Alpha • Jan 05

Eagle Bulk Shipping buys Ultramax bulkcarrier for $24.3M

Eagle Bulk Shipping (NYSE:EGLE) has acquired a 2015-built Ultramax bulkcarrier for $24.3M. The vessel, which was constructed at the Chengxi Shipyard Co., Ltd., will be renamed the M/V Gibraltar Eagle and is expected to be delivered to the Company during the first quarter of 2023. Following this transaction, Eagle's (EGLE) fleet will total 54 ships (89% scrubber-fitted) with an average age of 9.5 years.

Analyseartikel • Nov 20

Here's Why We Think Eagle Bulk Shipping (NASDAQ:EGLE) Might Deserve Your Attention Today

For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to...

Seeking Alpha • Oct 20

Eagle Bulk Shipping's Modern Fleet Pays For Its Dividend, Debt Cost And Your Vacation

Summary Eagle Bulk is operating a modern fleet comprised of Ultramax/Supramax vessels. This modern fleet and the associated economic benefits allow the company to provide its shareholders with a hefty dividend. The overall financial benefit from the company's modern (or modernized) fleet can be viewed as to two quarters of dividend or free debt servicing. While operating in the most resilient vessel segment, near-term rates could ease more. Also, the company is facing increased CapEx for 2023. Investors who seek exposure to the dry bulk shipping market but not to the roller coaster of larger vessels, should definitely look into Eagle Bulk Shipping. For those of us that have been investing in shipping companies for at least two years, Eagle Bulk Shipping (EGLE) is one of the companies that are always in our shortlist. The company has a specific set of advantages that provide it with increased resiliency against market downturns and allow it to face the future with a good degree of optimism. Today, I'm revisiting the company in an attempt to highlight these advantages in anticipation of their Q3 2022 earnings release scheduled for November 4th. Exclusively focused in the midsize vessel segment As I have written many times in the past, larger vessels are associated with higher volatility. The BCI, which follows the freight rates of Capesizes, is particularly prone to changes in steel output (see China) and in the global economic prospects, in general. On the contrary, one of the less volatile vessel segments are the Supramaxes / Ultramaxes. These usually have a carrying capacity ranging from 50k to 70k DWT and one of their key advantages is that they can dock in almost every port, without the need of loading / unloading equipment. From a purely economic standpoint, their smaller size makes their deployment less prone to commodity price fluctuations. For a more detailed discussion of the advantages of this vessel type, please refer to my previous article about the company, "Eagle Bulk Shipping: The Eagle will continue to fly". The company currently owns a fleet of 53 vessels, all of them belonging to the Supramax / Ultramax segment. The latest addition to the company's fleet was the purchase of a 2015-built Ultramax for $27.5 million, which is expected to be delivered in this quarter. The average fleet age is 9.5 years, which is affected by the 17 young vessels that the company purchased during the last 6 years. Modern fleet means larger savings From the total 53 vessels, 48 are scrubber fitted, which means they can operate on high sulfur oil and still comply with current environmental regulations. Speaking of environmental regulations, starting from next year, they will become stricter, as an extra tonne of CO2 emitted will result in a EUR 100 tax when operating in EU waters. In addition, as the high sulfur / low sulfur oil price differential is significant, scrubber fitted vessels will mean higher profit margins for shipping companies. Currently, this price differential stands at $225 to $321 per tonne. While not at record high levels, this figure is still quite material for most shipping companies. Eagle Bulk Shipping fleet scrubber benefit (Eagle Bulk Shipping October 2022 Investor Presentation) For Eagle Bulk Shipping, at the current oil spread of $238 per tonne, the total benefit will be $57.2 million, or a TCE benefit of more than $3k per day. Just to give you some perspective, for the second quarter of 2022, the company paid its shareholders a total of $28.5 million in common share dividends. In other words, with the inputs used above, each year the company saves around two times its current quarterly dividend from the use of scrubber fitted vessels. Eagle Bulk Shipping's attractive and transparent dividend policy Although I'm not a purely income investor, I like companies with significant dividend yields. Do you know what I like more? Companies with significant dividend yields and a transparent dividend policy. Knowing what to expect from your ownership is a huge plus for me, and that's what Eagle Bulk Shipping does, since last October. According to their dividend policy, they will pay out at least 30% of their net income to common shareholders. Based on the fact that with 72% of the days chartered, the company has a TCE rate of $29k per day, and with CapEx remaining stable, we're heading into a similar, yet I believe slightly reduced, dividend per share. However, even a dividend per share of $1.8 will stand for a forward annual dividend yield of 14%, which is brilliant. Well-laddered amortization schedule EGLE's debt amortization schedule (Eagle Bulk Shipping January 2022 Investor Presentation) The recent debt refinancing agreement created a much better debt amortization profile, while debt servicing cost got down to 3.6% from more than 7%. This is particularly important, given the general rise in the cost of debt. The cash debt amortization per vessel is at $2.6k per ship. From a different angle, we could argue that the scrubbers benefit is actually providing the company with free capital, based on the $3k effect in the TCE. This has enabled the company to be able to modernize its fleet, pay down debt while at the same time provide a hefty dividend to its shareholders. EGLE's liquidity and remaining revolving credit facility (Eagle Bulk Shipping October 2022 Investor Presentation) Potential risks Unfortunately, high potential returns nearly always come together with some risks. I have identified two potential risks for Eagle Bulk Shipping: 1. Increased CapEx in 2023: While the company has scheduled $1.3 million of CapEx in the last quarter of this year, the first two quarters have significantly higher figures. For Q1 2023, the company anticipates total CapEx of $5.7 million and for Q2 2023 total CapEx of $4.2 million. For the next two quarters of 2023, the company has planned CapEx of $4.6 and $5 million, respectively, as it is found in their investor presentation. The majority of these costs have to do with drydocking expenditures. These figures bring us to a total 2023 CapEx figure of $19.5 million, compared to $13.3 million spent (or planned) in 2022. However, off-hire days are anticipated to be significantly lower than 2022.

Analyseartikel • Sep 28

Eagle Bulk Shipping (NASDAQ:EGLE) Has A Pretty Healthy Balance Sheet

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously...

Seeking Alpha • Sep 13

Eagle Bulk Shipping buys Ultramax bulkcarrier for $27.5M

Eagle Bulk Shipping (EGLX) has acquired an Ultramax bulkcarrier for $27.5M, with delivery scheduled for the fourth quarter of 2022. The 2015-built scrubber-fitted vessel was constructed at Imabari Shipbuilding in Japan. It will be renamed the M/V Tokyo Eagle. As previously disclosed, the company closed on the sale of the M/V Cardinal (2004-built non-scrubber fitted Supramax) in August 2022. The vessel was sold for $15.8M and delivered just prior to her statutory drydock due date. Following these transactions, Eagle’s (NASDAQ:EGLE) fleet will total 53 ships (91% scrubber-fitted) with an average age of 9.5 years. EGLE shares have gained 2.13% pre-market

Seeking Alpha • Sep 07

Eagle Bulk Shipping Dividend In Light Of Shipping Rate Declines

Summary Eagle Bulk Shipping currently offers a very high dividend yield, near 19%. In August bulk shipping spot rates declined dramatically. Uncertainty is high, but bulk rates are likely to recover and remain profitable in 2023. Eagle Bulk Shipping (EGLE) is currently paying one of the highest yields on the market, almost 19% as I write. This has been enabled by the high bulk shipping rates we saw from about mid-2020 until August 2022. Usually, each year, seasonal demand sends shipping rates up in the late summer and into the early winter. Rates tend to decline to annual lows in the first quarter of the year. Even in that pattern there is usually a great deal of volatility. This article will focus on the surprise rate decline of August 2022, possible future scenarios, and the impact of rates on Eagle Bulk’s profits and dividend payouts going forward. EGLE data by YCharts Much of this article’s analysis is dependent on bulk shipping rates, for which the most general indicator is the Baltic Dry Index. Q2 2022 Results Second quarter Eagle Bulk Shipping results set a record for net income. Revenue for the quarter was $199 million, up 53% y/y from $130 million. GAAP net income was $94 million, up a factor of ten from $9.2 million in Q2 2021. On a diluted basis GAAP EPS was $5.77. Non-GAAP net income was lower at $82 million or $4.98 per share. Cash flow from operating activities was $140 million. Cash and equivalents ended at $139 million. Eagle’s bulk ships were valued at $885 million. Debt included $50 million as the current portion of long-term debt and $318 million noncurrent long-term debt. Fleet utilization was 99.8%. At the current stock price on September 6 market capitalization is $596 million. Eagle Bulk Shipping specific factors Eagle specializes in two of the mid-sized major classes of bulk carriers, Ultramax and Supramax. For these categories they have one of the larger of the world’s fleets with a total of 53 ships. Notably Eagle does not own Capesize vessels, which are used mainly for iron ore and coal going directly from Brazil, Australia, and other major sources to, mostly, China. But they do carry smaller loads of coal and iron ore to less intense users, plus other ores and grains. If you look at Slide 7 from the Eagle April presentation, you can see that the focus on the Supramax category contrasts with that of Star Bulk (SBLK), Golden Ocean (GOGL) and others in their peer group. Because minor bulks are more varied, Eagle is not as prone to single points of failure, as happens to iron ore and coal carriers when major mines or ports are closed. The Eagle cargo mix is shown on Slide 16 of the presentation just mentioned. Note there is seasonality, as coal is usually more in demand for winter heating and grains get shipped after harvests. Baltic Dry Index Trends If you are a short-term speculator, it is important to realize that the BDI (Baltic Drying index) has subcomponents, notably the Capesize, Supramax, and Panamax indexes. It is largely driven by spot rates, while some companies have longer-term contracts with their customers. An individual company’s ability to set rates may vary from industry average reflected in the BDI. Since I am a long-term investor, and this article is mainly for dividend investors and long-term investors, I will only go into the overall BDI here, using it as a proxy for shipping rates. First, note that short-term events can drive short term variations in rates. In the past decade, for instance, we have seen rates plunge for from a few days to a few months when a major export facility for iron ore or coal was closed by a tropical storm. I do not worry much about that kind of thing because it does not change overall demand. Once the port is reopened it tends to drive up rates as stockpiles are rebuilt at the end consumers. Lack of demand is a larger concern, but these last few years that has tended to be specific to the Chinese government seasonally reducing steel or electricity production in order to reduce air pollution or for some other end. If the current high inflation environment does lead to a significant reduction in overall demand, rates will certainly go lower. Balancing out the supply-demand situation is the building of new ships and the scrapping of older ships. In the years following a very high spike in shipping rates from about 2003 to 2010, financing and building dry bulk vessels seemed like an easy way to make profits. But it takes about 3 years from concept to launch, and low rates caused by an oversupply of vessels eventually led to a mid-decade slump in which banks were taught a hard lesson. Since 2015 getting bank financing for newbuilds has been more difficult so the number of ships coming onto the market has been a better match for supply, arguably lagging it in 2021. Very few newbuilds are expected to launch in 2022 and 2023. Unless there is a significant increase in orders, we won’t see many until at least 2025. That said, if a macroeconomic downturn is severe enough, even the number of ships currently in the water can turn out to be too many, for a while. So, while I am optimistic, I am prepared to endure some choppy seas until inflation comes back down to normal levels. At the end of the day on September 6, 2022, the BDI stood at 1,114. The recent peak was at 5650 on October 7, 2021. Looking back over the last 5 years, the BDI spent months below 1000 in both 2019 and 2020, even going below 500 briefly in 2020 during the panic at the beginning of the pandemic, when much of China closed down. The recent Covid related closures in China have not helped with demand, nor has its real-estate building pause. Predicting when strong demand might return is beyond my purview, but I believe the Chinese government wants for demand to return, so it is just a matter of time. Dividend Sustainability The dividend for the second quarter was $2.20 per share, payable on August 26 to shareholders of record on August 16, 2022. Trailing 12-month dividends were $8.25. At the close of $41.81 per share on September 6 that results in a yield of nearly 19%. For Q2 it was 30% of GAAP EPS or 44% of non-GAAP EPS. Clearly if Q2 2022 were an indicator of profitability going forward the current dividend level would present no problem. But just a year earlier a $2.20 dividend would have greatly exceeded net income. Looking back, the company first hit a quarter with profits sufficient to pay this level of dividend in Q3 2021. It was not even close before that. Going forward, expect dividends to depend on profits, which will depend on shipping rates. Given the uncertain outlook for shipping rates (see above), I do not project any certainty for a $2.00 or more per quarter dividend going forward. In Q3 rates look weaker than the rest of the past year, though they could still spring back in September. If Eagle booked most of its shiploads while rates were higher early in the quarter, Q3 profits might be near Q2 levels. I have covered what the future, at least 2023, may look like above. As goes the BDI, so will dividends go, more or less.

Seeking Alpha • Aug 18

Eagle Bulk Shipping: Total Return Potential Points To A Strong Sustainable Dividend

Eagle Bulk Shipping reports record net profits for the second quarter. Income statement & balance sheet trends point to more gains for shareholders. Investors can also use EGLE stock's 50%+ implied volatility to collect even more income through covered calls. An Introduction To Eagle Bulk Shipping We wrote about Eagle Bulk Shipping Inc. (EGLE) in December of last year when we stated that the company's very generous dividend was bound to attract the interest of income-orientated investors. Before we turn to the dividend, however, also in that December 2021 article, we spotted a potential symmetrical triangle (Bullish continuation pattern) which actually broke out of consolidation in February of this year. The break-out led to an incessant rally which resulted in shares of Eagle almost reaching $80 a share in June of this year. Elevated volatility however over the past few months has shares once more trading under $50 which means they are currently fighting to remain above their 200-day moving average. The one solace however is that shares have significant support above the $40 level (upper trend-line of the above-mentioned triangle) if indeed shares continue to lose ground in upcoming sessions. Eagle Bulk Shipping Technical Chart (Stockcharts.com) The other area which definitely has the capacity to limit downside risk in Eagle is its dividend. The lower the stock goes, the higher the yield will grow all things remaining equal. Based on Eagle's most recent quarterly dividend payment ($2.20 per share), the shipper's forward yield presently comes in at approximately 18%. This yield is achieved with a conservative payout ratio (30%) (Well covered by net earnings). However, in order to really ascertain how strong Eagle's dividend is at present, let's delve into Eagle's key trends on its income statement & balance sheet. Suffice it to say, the healthiest dividend stocks are the companies with the most appealing total return potential. Eagle Bulk Income Statement Give n the sustained lack of profitability, Eagle has endured over the past decade, nobody could have predicted the transformation on the company's income statement in recent times. Net profit in the second quarter surpassed a record $94 million. The number was driven by revenues of almost $200 million buoyed by more available days and higher rates encompassing a net TCE of over $30k per day. Given how Eagle's earnings have soared, all of its main profitability metrics, such as return on assets, operating margins, etc., are obviously much higher than yesteryear. From our standpoint however and taking into account Eagle's generous dividend, net interest expense (A metric that potentially could affect the dividend) over the past four quarters only came to $24 million which is small change really compared to the shipper's operating profit of $340+ million over the same period. An encouraging sign. The question going forward is whether this momentum can be sustained on the income statement. Top-line estimates for Q3 remain bullish but bottom-line revisions look to be on the wane from the fourth quarter this year onward. This means margins are expected to fall from present levels going forward which most bring down the dividend payout if realized. However, given where shares are trading at present from a valuation standpoint. notwithstanding the current dividend yield, a predicted fall in earnings should not hurt Eagle's shares in any significant way. EGLE Balance Sheet Liquidity and solvency numbers continue to improve in Eagle which is obviously beneficial for the sustainability of the dividend. On the liquidity side, current assets have closed to doubled (97%) since the bear market bottom back in April 2020 whereas current liabilities have risen by 48%. Cash (as a result of robust operations) continues to increase on the balance sheet. Suffice it to say, given Eagle's increasing working capital and the fact that it has access to a $100 million unresolved revolver, plenty of cash should remain to keep on paying that generous dividend.

Analyseartikel • Aug 09

New Forecasts: Here's What Analysts Think The Future Holds For Eagle Bulk Shipping Inc. (NASDAQ:EGLE)

Shareholders in Eagle Bulk Shipping Inc. ( NASDAQ:EGLE ) may be thrilled to learn that the analysts have just delivered...

Analyseartikel • Aug 05

Why The 30% Return On Capital At Eagle Bulk Shipping (NASDAQ:EGLE) Should Have Your Attention

If you're not sure where to start when looking for the next multi-bagger, there are a few key trends you should keep an...

Seeking Alpha • Aug 04

Eagle Bulk Shipping Non-GAAP EPS of $5.77 beats by $1.05, revenue of $198.7M beats by $41.33M

Eagle Bulk Shipping press release (NASDAQ:EGLE): Q2 Non-GAAP EPS of $5.77 beats by $1.05. Revenue of $198.7M (+53.0% Y/Y) beats by $41.33M. Generated EBITDA of $113.9 million ◦ Adjusted EBITDA of $102.6 million

Seeking Alpha • Jul 19

Eagle Bulk Shipping: A Risky Shipping Play

Eagle is a highly profitable shipping company with a current yield of c.13%. Although there are headwinds ahead, we think charter rates should remain elevated for an extended period of time, allowing investors to capitalize. The business is currently trading below its book value, providing protection to investors if the share price falls further. Although risky, we rate EGLE stock a buy. Investment Thesis: Eagle Bulk Shipping Inc. (EGLE) is a dry bulk shipping business, providing its ships for the transport of commodities such as coal. We like the business because its vessels are the type that have the least amount of volatility in price and, due to macro headwinds, are likely to be hit the least. Although we think macro conditions will be net-negative for EGLE, the business is positioned well to take advantage of current charter rates to at least have a good 2022. With the current order book remaining low, we are expecting the cyclical nature of the industry to be less damaging. Charter rates remain at a heightened level, as a result of inflation and the Russian invasion of Ukraine. The impact of these two will not dissipate quickly and that is what investors can benefit from with EGLE. Within this industry, it is not uncommon to find businesses with shaky balance sheets that are one recession away from being deleted from existence. This is not the case with EGLE: the balance sheet is solid, and the vessels' value more than covers the debt positions. With the business's current dividend policy and efficient operations, investors should be rewarded comfortably with a strong yield, which currently sits at 12.82%. We thus rate EGLE a buy. Company Description: Eagle is a shipping business with a fleet of 53 dry bulk ships, comprising predominantly Ultramax and Supramax. EGLE’s ships are in the region of 55-65 thousand metric tons ((DWT)) and carry such goods as coal, iron ore, grains, and other bulks. The shipping industry has had eventful few years. It had an initial crash during the COVID-19 pandemic, as economies (and thus demand) ground to a halt. Subsequently, we saw a resurgence as supply chains struggled to get up to capacity, while pent-up demand exploded. EGLE’s share price has moved in unison with this, falling from $30 to $10 and then subsequently rising to $76, before falling again to $47. Prospective investors should understand this from the start: although shipping businesses are attractive for their yield, their stock prices are far more volatile than your average high dividend stock. Data by YCharts Macro considerations: Shipping businesses act as a bridge between the demand for goods within an economy and the producers. With the move towards globalization, the shipping industry and the world economy have become highly correlated. Therefore, to assess EGLE’s medium-term prospects, we need to look at the health of the world economy. Inflation: Inflation in the U.S. hit 9.1% in May-22, on the back of persistent cost increases across specific industries, including energy. This has led to many countries approaching a cost-of-living crisis, with people struggling to service their short-term obligations. This has investors fearing stagflation, as discretionary spending falls but inflationary pressure remains. The problem for EGLE here is that charter rates have risen on the back of this inflation, and companies have bid-up rates in order to meet demand. This can only continue for so long, however, and we may finally be seeing the impact of this. If economic growth slows, so will the demand for dry commodities. A counterpoint here is that many of the goods EGLE transports are necessities, such as grain and coal, and so even if economies begin to struggle, much of the demand will not dissipate. Russian Invasion: The Russian invasion of Ukraine has had a material impact on EGLE’s industry. The reason for this is that Ukraine is a major exporter of coal and grain, as is Russia. With sanctions placed on Russia, these commodities need to be transported from other countries, causing major disruption and thus demand for ships. Further, it is significantly more difficult to now get Ukrainian goods outside of the country as Russia has targeted ports. Should Ukraine fall, these commodities will also be lost. The final impact, which is likely the most impactful in the short-to-medium term, is the restrictions on Russian oil (and the potential loss of Ukrainian liquefied natural gas). Russia is the largest provider of oil to the continent of Europe, and the region is now looking to completely move away from Russian imports. Germany has already halted the controversial Nord Stream 2 and is targeting an end to imports in 2022. The replacement for this, especially for Germany (Who is the largest European economy and anti-nuclear), is likely coal. Even those who would like to ramp up nuclear have little choice in the short-term due to the initial set up cost (time and financial). This should mean sustained demand for coal, which otherwise was a commodity being slowly phased out in the western world. With winter approaching, we could see a short-term spike in demand for coal transportation, especially if Russia shuts off supply to Europe at a critical time. Fuel prices: As these ships require fuel, it is logical to argue that rising fuel prices will harm EGLE’s margins, and so there is an offset effect. According to Star Bulk Carriers (SBLK), though, this is not necessarily the case. The reason for this is that when fuel prices increase, the ships go slower to compensate. This leads to less overall tonnage being transported which bids up charter rates. Further, 47 of EGLE’s ships can operate on high sulfur fuel oil ((HSFO)) and so can take advantage of lower costs relative to very low sulfur fuel oil ((VLSFO)). The delta between the two fuels is widening, with HSFO falling. EGLE estimated that the benefit of this is c.$39M, although it will likely be higher now. Interest rates: Interest rates are slowly increasing globally in response to inflation. This has a compounding effect of slowing growth, which as we touched on above, will bring down demand. Further, this will impact EGLE’s current and future financing arrangements, which will eat away at profits and distributable returns. China: If problems from one country were not enough, we have China as well. The Chinese economy has been showing cracks in the last year or so, with the housing market beginning to struggle and the country remaining stubborn on its zero-COVID policy. Although the economy is growing, it is not by much, and many have suggested the period of expansionary Chinese growth through domestic spending may end. This has already had an impact on iron ore prices, which have fallen aggressively on the fears that demand from the Chinese construction market will fall. Additionally, with China continuing to threaten Taiwan and speak ill of Australia, we may see further negative disruption in the future. Even if this is just China reducing its exposure to Australian coal. The question is if they begin importing from Russia, which could lock EGLE out of the market. GDP: The culmination of the above is a bleak outlook for growth, which is one of the reasons we are seeing markets react as they are. We should however add that a period of stagflation or even a recession is not a certainty. The UK economy, for example, returned to growth in May, which was surprising to some but evidence of health in the economy. Shipping industry: The shipping industry has seen a boom in new builds / the order book as businesses look to take advantage of heightened prices. The issue here is that we may approach a time where demand falls but supply of ships continues to expand. The inevitable impact is a correction in charter rates. For dry bulks, however, this is not the case. Intermodal notes that levels remain low, with this unlikely to change. This should mean that there is not price decay from supply at least, which is very good news for investors. EGLE is arguably in the best segment of the dry bulk market, owning Supramax and Ultramax vessels. The reason for this is that these vessels historically have had less volatility and generally have a better utilization. This is due to the greater flexibility that comes with the size, allowing for more types of commodities which can be shipped. The attractiveness of Capesize is the greater margins, but you trade on volatility and less certain income. With coal and iron ore coming under pressure, we could see Capesize vessels struggle going forward. The Baltic Dry Index ((BDI)) is a great indicator for the health of the market, as it tracks the daily charter rates of dry bulk vessels in several routes. BDI (Trading View) We note that prices seem to be stabilizing after a sharp fall in October. Inflationary pressures and the Russian invasion likely have been catalysts for the move higher at several points in the last few months, and these issues are not going away. We could realistically see this continue in 2023. At these prices, EGLE is incredibly profitable, and that should mean large distributions for shareholders. Financials: EGLE has spent 9 of the last 11 years losing money, which is quite the achievement. In FY20, however, the business posted a fantastic $185M in net profit. This was on the back of 116.1% increase in revenue. What we like is that the business has very little in expenses outside of CoGS, with its OPM at 44% and GPM at 58.7% (Source: Tikr Terminal).

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Sneeuwvlok Score
Waardering	2/6
Toekomstige groei	3/6
Prestaties in het verleden	1/6
Financiële gezondheid	0/6
Dividenden	2/6

Historische aandelenkoersen
Huidige aandelenkoers	US$62.60
52 Week Hoogtepunt	US$65.09
52 Week Laag	US$39.15
Bèta	1.48
1 maand verandering	-2.89%
3 maanden verandering	17.14%
1 Jaar Verandering	40.77%
3 jaar verandering	76.54%
5 jaar verandering	72.98%
Verandering sinds IPO	-97.17%

	EGLE	US Shipping	US Markt
7D	1.3%	1.1%	-0.3%
1Y	40.8%	48.5%	26.7%

EGLE volatility
EGLE Average Weekly Movement	4.0%
Shipping Industry Average Movement	6.4%
Market Average Movement	7.2%
10% most volatile stocks in US Market	16.2%
10% least volatile stocks in US Market	3.2%

EGLE fundamentele statistieken
Marktkapitalisatie	US$693.16m
Inkomsten(TTM)	US$22.73m
Inkomsten(TTM)	US$393.80m

EGLE resultatenrekening (TTM)
Inkomsten	US$393.80m
Kosten van inkomsten	US$263.68m
Brutowinst	US$130.12m
Overige uitgaven	US$107.39m
Inkomsten	US$22.73m

Winst per aandeel (EPS)	2.05
Brutomarge	33.04%
Nettowinstmarge	5.77%
Schuld/Eigen Vermogen Verhouding	80.9%

Gegevens	Laatst bijgewerkt (UTC-tijd)
Bedrijfsanalyse	2024/04/08 20:52
Aandelenkoers aan het einde van de dag	2024/04/08 00:00
Inkomsten	2023/12/31
Jaarlijkse inkomsten	2023/12/31

Pakket	Gegevens	Tijdframe	Voorbeeld Amerikaanse bron ^*
Financiële gegevens bedrijf	10 jaar	Resultatenrekening Kasstroomoverzicht Balans	SEC-formulier 10-K SEC-formulier 10-Q
Consensus schattingen analisten	+3 jaar	Financiële prognoses Koersdoelen analisten	Onderzoeksrapporten van analisten Blue Matrix
Marktprijzen	30 jaar	Aandelenprijzen Dividenden, splitsingen en acties	ICE Marktgegevens SEC-formulier S-1
Eigendom	10 jaar	Top aandeelhouders Handel met voorkennis	SEC-formulier 4 SEC-formulier 13D
Beheer	10 jaar	Leiderschapsteam Raad van bestuur	SEC-formulier 10-K SEC-formulier DEF 14A
Belangrijkste ontwikkelingen	10 jaar	Bedrijfsaankondigingen	SEC-formulier 8-K

Analist	Instelling
Charles Fratt	Alliance Global Partners
Liam Burke	B. Riley Securities, Inc.
Gregory Lewis	BTIG

This company has been acquired

Eagle Bulk Shipping (EGLE) Aandelenoverzicht

Beloningen

Risicoanalyse

Eagle Bulk Shipping Inc. Concurrenten

Global Ship Lease

Genco Shipping & Trading

Danaos

Capital Clean Energy Carriers

Prijsgeschiedenis en prestaties

Recent nieuws en updates

Eagle Bulk Shipping Inc. has withdrawn its Follow-on Equity Offering in the amount of $50 million.

Consensus EPS estimates increase by 28%, revenue downgraded

Upcoming dividend of US$0.60 per share

Fourth quarter dividend of US$0.60 announced

Full year 2023 earnings: EPS exceeds analyst expectations

Eagle Bulk Shipping Inc. Declares Quarterly Dividend for the Fourth Quarter of 2023, Payable on March 21, 2024

Recent updates

Eagle Bulk Shipping Inc. has withdrawn its Follow-on Equity Offering in the amount of $50 million.

Consensus EPS estimates increase by 28%, revenue downgraded

Upcoming dividend of US$0.60 per share

Fourth quarter dividend of US$0.60 announced

Full year 2023 earnings: EPS exceeds analyst expectations

Eagle Bulk Shipping Inc. Declares Quarterly Dividend for the Fourth Quarter of 2023, Payable on March 21, 2024

Eagle Bulk Shipping Inc. Announces Resignation of Randee E. Day as Member of the Board of Directors

CEO & Director exercised options and sold US$332k worth of stock

CFO & Secretary exercised options and sold US$79k worth of stock

Price target decreased by 14% to US$52.58

Consensus EPS estimates increase by 38%

Third quarter 2023 earnings: EPS and revenues exceed analyst expectations

Eagle Bulk Shipping Inc. Declares Quarterly Dividend for the Third Quarter of 2023, Payable on November 22, 2023

Eagle Bulk Shipping: Patience Should Pay Off

Consensus EPS estimates increase by 46%, revenue downgraded

Consensus EPS estimates increase by 37%

Eagle Bulk Shipping Inc. to Report Q3, 2023 Results on Nov 02, 2023

Consensus EPS estimates increase by 45%, revenue downgraded

Eagle Bulk Shipping: A Complicated Story In A Volatile Industry

Upcoming dividend of US$0.58 per share at 15% yield

Eagle Bulk: Cheap Bulker With Decent Dividend

New minor risk - Financial position

Second quarter 2023 earnings: EPS exceeds analyst expectations

Consensus EPS estimates fall by 17%

Consensus EPS estimates fall by 16%

Eagle Bulk Shipping Inc. to Report Q2, 2023 Results on Aug 03, 2023

CEO & Director notifies of intention to sell stock

Eagle Bulk Shipping: A Bargain Trading Well Below Net Asset Value

Eagle Bulk Shipping Inc. (NYSE:EGLE) announces an Equity Buyback for 3,800,000 shares, for $219.3 million.

Eagle Bulk Shipping: Danaos Corporation Reveals 9.99% Stake - Buy

Upcoming dividend of US$0.10 per share at 16% yield

Eagle Bulk Shipping Inc. Declares Dividend for the First Quarter of 2023, Payable on May 25, 2023

First quarter 2023 earnings: EPS and revenues exceed analyst expectations

Consensus revenue estimates increase by 11%

CEO & Director exercised options and sold US$183k worth of stock

Eagle Bulk Shipping Inc. (NYSE:EGLE) Looks Inexpensive But Perhaps Not Attractive Enough

Investor sentiment deteriorates as stock falls 17%

Upcoming dividend of US$0.60 per share at 12% yield

Price target increased by 7.5% to US$71.88

We Like Eagle Bulk Shipping's (NYSE:EGLE) Returns And Here's How They're Trending

Eagle Bulk Shipping: A Mid-Sized Vessel Specialist With An Edge

Eagle Bulk: Midsize Dry Bulk Market Update (Podcast Transcript)

Is It Too Late To Consider Buying Eagle Bulk Shipping Inc. (NYSE:EGLE)?

Eagle Bulk Shipping Inc. to Report Q4, 2022 Results on Mar 02, 2023

Eagle Bulk's Fortunes Are Likely To Turn Soon

Eagle Bulk Shipping Inc. Appoints A. Kate Blankenship to Its Board of Directors

CEO & Director exercised options and sold US$155k worth of stock

Eagle Bulk Shipping buys Ultramax bulkcarrier for $24.3M

Eagle Bulk Shipping Inc.(NYSE:EGLE) dropped from NASDAQ Composite Index

CEO & Director recently sold US$762k worth of stock

CEO & Director notifies of intention to sell stock

Here's Why We Think Eagle Bulk Shipping (NASDAQ:EGLE) Might Deserve Your Attention Today

Insufficient new directors

Upcoming dividend of US$1.80 per share

Third quarter 2022 earnings released: EPS: US$5.94 (vs US$6.12 in 3Q 2021)

Eagle Bulk Shipping's Modern Fleet Pays For Its Dividend, Debt Cost And Your Vacation

Investor sentiment improved over the past week

Eagle Bulk Shipping (NASDAQ:EGLE) Has A Pretty Healthy Balance Sheet

Eagle Bulk Shipping buys Ultramax bulkcarrier for $27.5M

Eagle Bulk Shipping Dividend In Light Of Shipping Rate Declines

Eagle Bulk Shipping: Total Return Potential Points To A Strong Sustainable Dividend

Consensus revenue estimates increase by 14%