MC Shipping: What Lies Ahead?

This should be an easy stock to follow,” an MC Shipping shareholder stated recently. The inference was that it is, in fact, not so easy to follow. At the same time, the investor made it clear that he was not unhappy – just caught by surprise by the first quarter results.

There has been a recent wave of new investors into shipping, attracted by low share prices relative to even highly discounted asset values and the prospects of attractive dividend yileds from operations rather than straight asset appreciation. For the recent investors in shipping equities, there is little to be upset about.

In MC Shipping’s case, the stock moved up from $4.88 a share to $8 during the first quarter. And, despite a first quarter dividend of only $0.25, it is conceivable that, for the year, the stock will yield a dividend return of around the 15% goal mentioned in its original prospectus.

For a business that most recently was sold to equity investors the world over as an asset play, the comment is a telling one for those companies with basic operational soundness to step forward and explain just why shipping deserves the attention – not just the dollars – of investors.

This is only an excerpt of MC Shipping: What Lies Ahead?

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