Dryships Stock Breakout a Beauty

A great move today from Dryships Inc (DRYS) stock which was featured in my Wednesday night edition of Blain's Nightly Stock Picks. The stock tallied 8% to close at $89.96, almost two points above the $88.20 buy point.

For those who are not familiar with the stock, Dry Ships is a provider of carrier transportation services for drybulk commodities. The company operates a fleet of 35 vessels.

Take look at the chart below to see its breakout today. My stop is the low of today, or $84.49.

drys-050208.png

Comments

  1. Posted by Bryan on May 3, 2008 at 3:47 am

    FRO is having a great run too. Rates are shooting up for tankers. There was a report on Bloomberg (I think) that Iran was using some of FRO's tankers to store heavy crude because they have a glut of the sulfury stuff.
    I'm tempted to sell and take gains but I bought it around $42 and the dividend yield is roughly 18% if they keep payments at the level they've been at.
    Take a quick 40% gain or hold on and collect the dividend. It's a nice problem to have. :mrgreen:

  2. Posted by Blain Reinkensmeyer on May 3, 2008 at 12:50 pm

    Bryan,

    That is definitely a nice problem to have!! These shippers are really coming into focus now, and all of them have had some nice bases. Great play with FRO so far. When you bought around $42, were you buying into strength or what exactly were you looking at?

    Great play and thanks for reading. :mrgreen:

  3. Posted by RayJMan on May 3, 2008 at 3:29 pm

    Phenonemnal volume & movement into close Fri.!! Anything transports has been "moving", excuse the pun. For a long term investment, I simply went with Ishares, IYT.

    Keep an eye on EGLE as well. The price movement has been phenomenal last week. It will be interesting to see as well what they have to report his coming Wed. as it affects the sector, albeit their market cap is lower than the good old gold pirates at DRYS! Aye & happy trading, Ray

  4. Posted by Steve on May 3, 2008 at 4:32 pm

    Great site Blain. I just found it via Google search. I bought DRYS on a false breakout Monday at 87.50. It ridiculously dropped to 80 on an EXM downgrade the next day. Needless to say, I held on to DRYS and looked at the chart and avoid giving in to my emotions. Glad I did.

  5. Posted by Steve on May 3, 2008 at 10:45 pm

    As a follow up about emotions, it's a big confidence killer for me. I know that the market trades mostly on emotions, fear and greed. So how do you trade without it?

    One bad example I want to share with you. In February, I bought AAPL at 130. I thought that it had bottomed and was on its way back up. I was wrong, instead it fell to 118. It then gyrated between 118 to 125 for about a week. I had read about the Mac show that was coming up in the first week of March. I had a feeling that the show could have been the catalyst to move the stock higher. Instead, I got so depressed about being 12 pts down that I sold it for a huge loss. I took a break for 3 months and didn't look at stocks at all until last week. I applied what I learned from AAPL to DRYS.

  6. Posted by Bryan on May 4, 2008 at 12:53 am

    The hefty dividend, which has been relatively predictable in regards to its minimum payout, was my main attraction. I've actually been holding it since November so I've received 2 payouts plus a special div from an acquisition. I'm kickin' myself for not buying more when it was in the mid-30s but gains are gains. Looking at FRO's 5 year chart the high looks like it's just under $64 and FRO's going nearly parabolic in the past month with that number in it's sight. $50 looked like the last major resistance level so when it broke thru that it was off to the races. Earnings are at the end of the month and estimates are nearly double last year's Q1. I'm not exactly sure when the rates really picked up but there's been some articles recently citing them as significantly higher than last year.

  7. Posted by Blain Reinkensmeyer on May 4, 2008 at 5:58 pm

    "So how do you trade without it?"

    I still trade with emotions, but try to minimize them as much as humanly possible. The best way for me to do that is to always have stop losses to limit my downside. I typically have a decent sense of knowing when to take profits, but if I don't place a stop right when I purchase and I am down on a position that typically spells trouble for me.

  8. Posted by Blain Reinkensmeyer on May 4, 2008 at 6:01 pm

    FRO has had a great run since its recent breakout and the move Friday was stellar (less the lack of volume). Great insight Bryan and hopefully these shippers pull out some strong profits for us.

  9. Posted by Bryan on May 5, 2008 at 11:19 am

    FYI Nordic American Tanker (NAT), another shipper that I own, just reported great earnings. Dividend is up 136% from previous quarter and daily rates for the tankers were about 1.8x higher than previous quarters.

  10. Posted by Chris on May 6, 2008 at 8:54 am

    My link to this post has been a big hit for conversions. Does the data show that on your side?

  11. Posted by RayJMan on May 6, 2008 at 5:39 pm

    EGLE reports, wow....keep an eye on DRYS tomorrow

  12. Posted by Blain Reinkensmeyer on May 6, 2008 at 11:52 pm

    DRYS is up after hours! Thanks for relaying the new Ray.

  13. Posted by Blain Reinkensmeyer on May 6, 2008 at 11:57 pm

    MyBlogLog is showing about 80 clicks from your site on both Sunday and Monday. Was it higher than this?

Trackbacks

  1. [...] Dryships Stock Breakout a Beauty -Time will tell (new highs are a must). [...]

  2. [...] Dryships (DRYS) has not slowed down since it hit my buy point of $88.20 on May 2nd, closing Friday at $110.74. View the original Dryships stock breakout. [...]

  3. [...] those who are new to the blog, DRYS was a recent selection which we ran from just over $88 to well over $100 in less then three [...]

  4. [...] Dryships (DRYS), Genco Shipping (GNK), and Excel Maritime (EXM). Readers of this blog know we ran Dryships from $88.20 to over $100 not even a month [...]