Chinese Manufacturing Slowdown Could Nix DryShips Recovery: DryShips Inc. (NASDAQ: DRYS), Dynavax Technologies Corp. (NASDAQ: DVAX), FuelCell Energy Inc. (NASDAQ: FCEL)


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NASDAQ:DRYS / NASDAQ:DVAK / NASDAQ:FCEL
01/27/2014 [ACCESSWIRE]

DryShips Inc. (NASDAQ: DRYS) stock volume soared at the close of the market Jan. 24 with 26,149,820 shares changing hands, making it one of the most actively traded penny stocks for the day.

But it’s unclear if DryShips’ high share volume is being driven by this potentially positive news or the negative news that Chinese manufacturing is sputtering to a slowdown. According to the New York Times, the flash Markit/HSBC Purchasing Managers’ Index fell to 49.6 in January from December’s final reading of 50.5.  Economists contend when this index drops below 50 it signals the beginning of an economic contraction.

This concern comes only a few weeks after the Athens, Greece diversified marine transportation company said that it would continue its previously-announced program to issue $200 million in common stock in an at-the-market offering with Evercore Group LLC as its sales agent.

In need of a recovery

DryShip’s recent offering is expected to provide the estimated $150 million the company needs to operate through 2014. This influx of needed capital helps to erase the negative news of Dec. 5, when the company suspended its equity offering with share price of about $3.60. But, any shipping company’s recovery depends a lot on prevailing economic conditions.

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Lately, there has been much uncertainty in the shipping sector.  That’s because this year there is also news that China has less need for iron ore. This bodes badly for all cargo shipping firms in general and for DryShips specifically.  In addition, spot capesize shipping rates have fallen by 33% year-to-date, putting even more pressure on DryShip’s bottom line.

Analysts’ consensus

Of the six analysts covering DryShips’ stock, five of them recommend a "hold" on the stock, while one recommends a "sell."

At close of the market on Jan. 24, DRYS share price closed at $3.38, down 39 cents from $3.77 a share the previous day.

Find out what could be the best investor’s move when it comes to DRYS by getting the complete report here, or by cutting and pasting the following link in your Web browser:

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Dynavax Technologies Corp. (NASDAQ: DVAX), a biopharmaceutical company developing new drugs to prevent and treat infectious diseases, is another penny stock with volume shooting through the Van Allen Belt.

At the close of the market Jan. 24, the Berkeley, Calif.-based company traded 5,780,919 shares, which is slightly higher than its three-month daily average of 5,180,196.

Dynavax’s volume could be riding the tidal wave of positive PR its clinically-developed Heplisa has been generating lately. This is a hepatitis B vaccine that although rejected by the FDA earlier this year because it didn’t have enough data to determine its safety, is considered superior to present vaccines and is currently being reviewed for possible European approval.  Moreover, Dynavax has not given up on FDA approval and is launching a new late-stage trial of Heplisa, which it hopes to complete in 2015.

Analysts’ consensus

Of the four analysts covering Dynavax’s stock, three of them recommend "a strong buy" on the stock, while one recommends a "hold."  

On Jan. 24, DVAX share price closed at $ 1.86, down 8 cents from $1.94 the previous day.

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At the end of the trading day Friday, 4,753,280 shares of renewable-energy company FuelCell Energy Inc. (NASDAQ: FCEL) changed hands, making it one of the most active penny stocks traded.

This most likely comes as a direct result of the Danbury-Conn. fuel-cell maker’s announcement Jan 23 of a public offering of 22 million shares of its common stock at a price of $1.25 a share. The net proceeds from the sale of the shares, after deducting the underwriters’ discounts and other expenses are estimated to be $26 million. FuelCell has also granted the underwriters a 30-day option to purchase up to an additional 3.3 million shares of common stock offered in the public offering to cover over-allotments, if any, which would result in additional gross proceeds of about $4.1 million if exercised in full.

FuelCell said it plans to use the infusion of 26 million for project development, project finance, working capital support and general corporate purposes.

Find out what could be the best investor’s move when it comes to FCEL by getting the complete report here, or by cutting and pasting the following link in your Web browser:

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Completion of Dominion Deal

FuelCell’s public offering comes only a few weeks after it announced the completion of its 14.9 megawatt fuel-cell park on schedule for Dominion. The project is located on a remediated brownfield site in an industrial area of Bridgeport, Conn., using only about 1.5 acres of land to provide the renewable power.

Renewable energy slow to yield profits

While both these events are positive news for FuelCell, the unpleasant reality that’s being ignored in their releases is the fact that renewable energy companies have barely broke even, never mind turn significant profits. The fuel-cell industry’s total gross sales in 2012 were $120.6 million, while its costs were 120.2 million, according to the Dept. of Energy.

Analysts’ consensus

Of the four analysts covering FuelCell’s stock, three of them recommend “a strong buy” on the stock, while one recommends a “hold.”  

On Jan. 24, FCEL share price closed at $1.40, down 6 cents under its closing price of $1.46 the previous day.

Find out what could be the best investor’s move when it comes to FCEL by getting the complete report here, or by cutting and pasting the following link in your Web browser:

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