Boston, MA 10/07/2014 (wallstreetpr) – Over the last few days, DryShips Inc. (NASDAQ: DRYS) has fallen to an attractive level, alluring investors about a promise that it could not get better. But, there is little doubt if it is true as there are several headwinds thumping the doors of the company, warning it of making new lows.
Headwinds On The Way
Firstly, the company is clearly associated with Ocean Rig UDW Inc (NASDAQ:ORIG). During the last week, Ocean Rig has tested a 52-week low of $15.20, which is ultimately impacting DryShips Inc. (NASDAQ:DRYS). This is easy to explain as DryShips holds nearly 78.3 million common shares of Ocean Rig, which means that if the latter dives down then it will automatically pull the former with it too. Secondly, the pressure built at oil prices have also added to the concerns for the company.
Its CEO, George Economou has already said that the falling oil prices will negatively impact the company. Oil price fluctuations hurt the company’s business not only by way of impacting the deepwater drilling, but also by putting off the shipping market. ‘Baltic and International Maritime Council’s’ chief shipping analyst, Peter Sand explained that during high fuel prices, companies tend to employ slow steaming to achieve fuel economy. While cheap fuel prices leads fast-moving ships and apparently oversupply that result in price impact on companies like DryShips Inc. (NASDAQ:DRYS).
Senior Notes Issuance
Also, DryShips Inc. (NASDAQ:DRYS) tested a new low last week after it announced the public offering of its senior secured notes that are due to mature in 2017. These notes will be denominated in 1000. The proceeds from the issuance of senior notes, DryShips Inc. (NASDAQ:DRYS) will utilize the settle its $700 million principal amount due towards 5% convertible senior notes maturing on Dec 1, 2014. The shares of the company closed 2.71% higher at $2.27 yesterday.
