Genco Shipping & Trading Limited (GNK)

5-star $624 million market cap on 11/26/06.
Cargo shipping.
5STARsmallCAPS picks five star stocks with the smallest market caps.

I think the best of the run up in the dry good shipping industry is behind us, but as long as China continues to grow, GNK should continue to produce.

I really like shipping industries. I just don't think that this one has got what it takes.

Genco Shipping & Trading Limited (GS&T) is engaged in transporting iron ore, coal, grain, steel products and other drybulk cargoes.

I believe the entire dry bulk shipping sector is stratospherically overvalued. With more ships coming online everyday, I believe dry bulk shipping rates will fall.

I'm betting this is the next bubble.

Gnk is in shipping which I like and has the makings of a reverse head and shoulder. It is a top pick of Zacks and looks good

Expanding market's in Asia and Europe with upswing in growth for this company, outlook in 10K put's this company in outpreform for the next 5 years

I made this pick based of the strong fundamentals of the company. For more information see www.anticitrade.com.

score = 85

This company appears to be a "value play" by most metrics. They also pay out a healthy yield, which while exceeding the payout ratio, is well within the current Net Cash After Operations (NCAO) minus the low capex in the past three years - which I'm taking to be the "maintenance capex" level (i.e. the needed capex as opposed to expenditures used to fuel future growth).

GNK reached a new high today and its p/e is still quite low. Look for anotrher 10 to 20 % rise in the next few months.

A leader in dry bulk shipping that is undervalued and ready to soar.

Dry shipper. Can't go wrong.

Veredus

PER YAHOO- 03/01/07- Div & Yield: 2.64 (8.90%)

Stockpickr: Top 10 High-Yield Small-Caps

By James Altucher
RealMoney.com Contributor
3/1/2007 6:56 AM EST
Click here for more stories by James Altucher

Few things in life are better than receiving a good dividend check in the mail. Perhaps the only thing better is owning a small-cap stock as it goes from small-cap to mid-cap to large-cap -- it's an experience you'll never forget.

So when you find growing small-caps that also pay good dividends, they're worth a second look. At Stockpickr, we keep track of the highest-yielding small-cap stocks.

There is a lot of things to like about Genco Shipping & Trading (GSTL - Cramer's Take - Stockpickr - Rating). If you're the type who follows charts, you have to admit the action in Genco over the past year certainly looks pretty.

When I see a chart like the one shown below, I usually think the stock must be peaking, or perhaps is overvalued. But Genco trades at just 12 times this year's earnings and 11 times next year's earnings.

The company ships dry bulk cargoes worldwide. So if you were a big commodity trading house with a couple of million tons of sugar, Genco would be a good fit, as it could charter your ship and get the cargo shipped. This is an ugly business but the company gets paid well for it, with 50% margins and 18% return on equity.

The main reason Genco is on this list is because it pays out a 7.6% dividend yield. It has paid out 60 cents a share every quarter since going public, although last quarter it upped the dividend to 66 cents.

Typically, companies don't increase dividends unless they are extremely confident that they aren't going to have to immediately decrease it.

Genco also can be found in the 9% Yield Club portfolio on Stockpickr

Charts say it is going up in the near term

Solid Balance Sheet and management experienced in the shipping business (mainly oil) and experience in growing a shipping company. Dry shipping is currently a very hot market and a lot of players are jumping in. GSTL realizes that at some point this cyclical industry is going to turn south,which they have built into their business plan. This industry is very segmented, and there is a lot of room for consolidation once the cycle turns, and the small players are forced out. By keeping a solid balance sheet, they will be able to buy more ships and expand at great prices. Finally, with global trade and populations increasing world wide, dry shipping isn't going to go away and will continue to grow. This is a cyclical industry, and we are near the top, but GSTL's plan for expansion prepares them for the downturn and positions them to become a dominate player in the global dry shipping business.

GNK leases dry ships and is undervalued.

Global economyis expanding, goods must be moved to market. Excellent dividend for the conservative investor.