Diana Shipping: No Longer Barely Afloat - Upgrade To Hold

Diana Shipping (DSX) is upgraded from Sell to Hold, with a fair value of $2.20 per share.

Diana Shipping (DSX) is a company that owns and bareboat charters in a fleet of 36 dry bulk carriers, spanning every class from Ultramax to Newcastlemax. I initiated coverage in November with a Sell under the Summary - Diana Shipping (DSX) is upgraded from Sell to Hold, with a fair value of $2.20 per share. - The fleet’s fixed-rate charters are now repricing into a stronger market, making the core business profitable for the first time in years.

- DSX’s $1.2 billion hostile bid for Genco (GNK) introduces significant uncertainty, with over half its market cap tied to GNK’s volatile equity mark. - I prefer to wait for the Genco tender resolution after July 24 before considering a position, given unresolved risks and inflated asset marks. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours.

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