By Market News Video Staff, Monday, January 31, 2:17 PM ET
Over the past month, drybulk shippers have watched the Baltic Dry Index fall from just under 1700 to just about 1100, as ship supply still far outweighs global demand. The declines have been seen across all ship classes, with the Cape, Panamax and Supramax indices all touching new lows in the past week. This leaves investors wondering if they are staring at the best value play of 2011 or the future battlegrounds for bankruptcy attorneys.
Some of the major players in the sector include Genco Shipping (NYSE:GNK), DryShips (NASDAQ:DRYS), Eagle Bulk Shipping (NASDAQ:EGLE) and Star Bulk Carriers (NASDAQ:SBLK). Genco Shipping and Eagle Bulk Shipping are trading just percentage points above their respective 52 week lows, while DryShips and Star Bulk Carriers are trading near the midpoint of the range. Of the four companies, only Star Bulk Carriers still pays investors a quarterly dividend.
For the brave searching for value, shipping ETFs could be a good option for diversification within the sector. The Guggenheim Shipping ETF (AMEX:SEA) holds 31 different shipping companies, with the highest weighting just 4.9% of the total fund and an expense ratio well below 1%.
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