NEW YORK (TheStreet) -- Shares of Paragon Shipping (PRGN) are soaring by 49.14% to $2.61 on heavy trading volume on Friday afternoon, after the company issued a statement calling a February 18 Tradewinds report that said its board of directors had approved a Chapter 11 bankruptcy filing "totally untrue."

Paragon Shipping is an Athens, Greece-based global provider of shipping transportation services. The company issued the statement on Thursday.

Paragon Shipping announced that the company along with its CEO, Michael Bodouroglou, have filed a lawsuit against Tradewinds and financial reporter Joe Brady for defamation damages.

"The company believes that such false statements had a negative impact on the company, its reputation and stock price. The lawsuit was submitted before the Prosecutor of the Criminal Court of Athens," Paragon Shipping said.

Additionally, the company announced that it has entered into an agreement with Jiangsu Yangzijiang Shipbuilding to extend the deliveries of its three Kamsarmax new building dry bulk carriers. 

Separately, TheStreet Ratings has set a "sell" rating and a score of D- on Paragon Shipping stock. This is driven by a few notable weaknesses, which TheStreet Ratings believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks it covers.

The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, disappointing return on equity and poor profit margins.

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.

You can view the full analysis from the report here: PRGN

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