"Under the Radar" uncovers little-known companies worthy of investors' consideration. Check in at 5 every Monday, Wednesday and Friday morning to find out about stocks that tend to beat their bigger brethren.
BOSTON (TheStreet) -- The manufacturing and retail industries are showing signs of revival. As a result, dry-bulk shippers are getting some buzz. As shipping rates plummeted during the recession, investors aggressively sold the stocks. But hopes of a recovery are whetting their appetites.
The Baltic Dry Index, a gauge of worldwide shipping prices and demand, began a downward trend in June. It then flattened and began creeping up on Aug. 25. DryShips (DRYS), Navios Maritime (NM) and Excel Maritime (EXM) have since been getting more attention than usual.
But all three succumbed to quarterly net losses over the past year and receive "sell" ratings from our proprietary model. Here is a "buy"-rated shipper that retained profitability during the recession, trades at a discount to its peers and pays a fat dividend.International Shipholding Corp. (ISH) isn't immune to the recession, but is faring better than its rivals. Second-quarter net income fell 41% to $11 million, but revenue climbed 63% to $100 million. Excluding a $15 million gain from the sale of a carrier in last year's second quarter, earnings rose almost four-fold. The company's gross margin widened from 20% to 23%, and its operating margin stretched from 4% to 13%, helped by a 4% reduction in general and administrative expenses. The company has a diversified fleet of carriers, including eight car/truck carriers that transport Honda (HMC), Hyundai and Toyota (TM) automobiles. The balance sheet is reassuring. International Shipholding increased its cash balance 242% to $70 million since the year-earlier period. A quick ratio of 2.2 demonstrates ample liquidity. Just $139 million of debt and a debt-to-equity ratio of 0.6 indicate conservative leverage.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV