Castor Maritime Stock May Be Nearing a Bottom Here

Wednesday, June 23, 2021 | Jea Yu
Castor Maritime Stock May Be Nearing a Bottom HereShipping fleet operator Castor Maritime (NASDAQ: CTRM) stock has been on a rollercoaster ride this year as sinks through a steady wave of dilution. The Cyprus-based company has acquired 20 vessels in 2021, mostly funded by raising cash through share offerings resulting in further dilution. It executed a 1-for-10 reverse stock split to meet the Nasdaq $1 price compliance mandate. The Company has been aggressive in acquiring new ships as it grows its fleet to 26 vessels. The Company currently has nearly 90 million outstanding shares post-reverse split. While bears attack from all angles citing dilution, speculative longs see this stock as a potential short squeeze play especially with the reverse split as dry bulk shipping rates are booming and the Company has swung into profitability. The Company is pursuing a dilution-based method of raising cash to grow its fleet via an acquisition strategy. Currently, the Company holds twice as much cash as debt and fundamentals appear to be improving as the post-pandemic reopening is surging dry bulk shipping rates. This is a micro-cap stock that is only suitable for speculators looking for an outsized return accompanied by high risk on deep opportunistic pullback levels.

Q1 FY 2021 Earnings Release

On June 3, 2021, Castor Maritime released its fiscal first-quarter 2021 results for the quarter ending March 31, 2021. The Company reported an adjusted earnings-per-share (EPS) profit of $0.02 or net income of $1.1 million compared to a net lost of (-$0.68) for same period year ago. Revenues rose 159% year-over-year (YoY) to $7 million versus $2.7 million in Q1 2020. The Company generated $2.6 million EBITDA in Q1 2021 versus $0.9 million in Q1 2020. Cash and restricted cash was $64.2 million at the end of the quarter compared to $9.4 million at the end of December 2020. As of the beginning of 2021, Castor announced the acquisition of 20 vessels across the dry bulk and tanker segments consisting of: 1 Capesize, 7 Kamsarmax, and 4 Panamax dry bulk carriers as well as 1 Aframax, 5 Aframax/LR2 and 2 MR1 tankers. As of June 2, 2021, the Company has taken delivery of 14 vessels with 6 expected to be delivered by the fourth quarter of 2021. On a fully diluted basis, the Company will own 26 vessels in its fleet with a capacity of 2.2 million dwt. Castor Maritime CEO Petros Panagiotidis stated, “The first five months of 2021 was a transformational period for our Company, as we were able to raise $252.2 million of equity and $33.3 million of debt and grow our fleet from 6 vessels, at the end of 2020, to 26 vessels on a fully delivered basis and once we complete all of our announced acquisitions. On a fully delivered basis, our fleet will consist of 18 dry bulk carriers and 8 tankers, allowing us to benefit from the ongoing strong demand for dry bulk transportation services as evidenced by the recent charter fixtures of a number of our dry cargo vessels, as well as from a potential future recovery in the tanker market.”

Updates

The vessel acquisitions in the quarter enabled charter revenues to increase to $7 million in Q1 2021.It enabled Available Days to increase from 214 to 596 in the three months ended in March 31, 2021. Dry bulk shipping rates were strong ranging from $18,500 gross per day to $27,500 gross per day as the Company expects 9 of its vessels to continue benefitting from the higher prices. The Company ended the quarter with $33.2 million in outstanding debt.

Offerings

The Company raised $125 million in proceeds on April 7, 2021, with a direct 19.230 million share offering priced at $6.50 which included one common share and one warrant. No warrants were yet exercised as of the earnings release. The Company took delivery of 2011 Japanese Panamax dry bulk vessel, M/V Magic Eclipse and commenced employed on June 9, 2021, under a time chart contract for 105 days at a daily gross rate of $26,500. On June 17, 2021, Castor took delivery of M/T Wonder Musica and inks charter agreement for M/V Magic Rainbow at a gross daily rate of $25,000 per day with a lease term between 7 to 9 months.

Castor Maritime Stock May Be Nearing a Bottom Here

CTRM Opportunistic Pullback Levels

Using the rifle charts on the weekly and daily time frames provides a precision near-term view of the landscape for CTRM stock. The weekly rifle chart is in a downtrend with a falling 5-period moving average (MA) at $3.38. The weekly stochastic is extremely oversold at the 2-band. The daily rifle chart has an inverse pup breakdown with the 5-period MA at $3.25 and 15-period MA falling at the $3.34 Fibonacci (fib) level. The daily market structure high (MSH) sell triggered on the breakdown below $5.13. The daily lower Bollinger Bands (BBs) are at $2.61. The daily stochastic took a bearish mini inverse pup through the 20-band down. The daily can form a market structure low (MSL) buy trigger above $4.07 but it will need to coil the daily stochastic back up. Speculators can monitors for opportunistic pullback levels at the $2.54 stinky 2.50s levels/daily lower BBs, $2.14 fib, $1.90 fib, $1.50 fib, $1.17 fib, $0.82 fib, and the $0.54 fib. Upside trajectories range from the $4.27 fib up towards the $6.04 fib level.

Should you invest $1,000 in Castor Maritime right now?

Before you consider Castor Maritime, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Castor Maritime wasn't on the list.

While Castor Maritime currently has a "N/A" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The 5 Stocks Here

 


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Castor Maritime (CTRM)1.1$2.10+1.0%N/A-11.67N/AN/A
Compare These Stocks  Add These Stocks to My Watchlist 

MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau

© American Consumer News, LLC dba MarketBeat® 2010-2021. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | U.S. Based Support Team at [email protected] | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Do Not Sell My Information

© 2021 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer. Fundamental company data provided by Zacks Investment Research.