Recs

0

Why Shares of Diana Shipping Inc. Plunged 12% Today

What happened 

Shares of shipping company Diana Shipping Inc. (NYSE: DSX  ) fell as much as 11.5% on Wednesday after announcing a share offering. At 3:30 p.m. EDT, shares were still down 11.4% and bouncing near their low for the day. 

So what

After the market closed on Tuesday, management announced that it has commenced a $70 million share offering with another $10.5 million potentially offered if underwriters exercise their over-allotment. CEO Simeon Palios and other executives and officers have said they will buy about $20 million of shares in the offering. 

Cargo ship on open water at dusk.

Image source: Getty Images.

The proceeds are expected to be used to fund the acquisition of new dry bulk vessels, three of which are already contracted. 

Now what

We don't know exactly at what price the offering will take place, but investors are betting that it'll be lower than where shares were trading yesterday. It's likely the offering will be priced in the next day or two, and investors will get a better idea of where the dilutive offering will take place. Until then, it's a little concerning that Diana Shipping is buying more vessels with dry bulk shipping struggling right now and the company losing money the last two years.

Time will tell if these ships are bought at an attractive price, but right now, investors aren't very excited about the offering, or the expansion of the company's fleet. 

10 stocks we like better than Diana Shipping
When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now...and Diana Shipping wasn't one of them! That's right -- they think these 10 stocks are even better buys.

Click here to learn about these picks!

*Stock Advisor returns as of April 3, 2017.


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 4014470, ~/Articles/ArticleHandler.aspx, 4/29/2017 1:24:40 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 4 hours ago Sponsored by:
Change down DOW 20940.5 -40.8 -0.2%
Change down S&P 500 2384.2 -4.6 -0.2%
Change down NASD 6047.6 -1.3 0.0%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

4/28/2017 4:02 PM
DSX $3.99 Down -0.25 -5.90%
Diana Shipping CAPS Rating: **

Article registration testing
VISIBLE INTERNALLY ONLY AND ONLY WORKS WITH UNREGISTERED VISITORS

Revisit this page

Clear article's cache and revisit this page

Or, visit the current page, forcing Test ID to article:interrupt:106919 and

Tookie Value = 35610392157743832081985606150946

Advertisement