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Eagle Bulk Shipping Inc (EGLE) Expands Its Fleet Despite Traders Selling

Shares of Eagle Bulk Shipping Inc (NASDAQ:EGLE) are in the red by around 2.5% today despite the company announcing that its proposed purchase of three contingent ships from Greenship Bulk has been approved, bringing the total amount of ultramax vessels Eagle Bulk Shipping will acquire to 9. Ultramax vessels range in size between 50,000 to 65,000 dwt and transport bulk cargoes such as grain, coal, cement, fertilizer, and other products. Shares of drybulk shipping stocks haven’t exactly been good performers in the past due to the Chinese economic slowdown (China imports a lot of commodities) and shipping over-supply. In the past six months, however, Eagle Bulk Shipping Inc (NASDAQ:EGLE) has been somewhat range-bound and dry bulk shipping rates in general have increased. Specifically, the Baltic Dry Index, has rallied from 712 on 9/1/2016 to 1240 today.

With the addition of those 9 ships, Eagle Bulk Shipping Inc (NASDAQ:EGLE) will have a total of 50 vessels overall, further enlarging one of the world’s largest drybulk shipping fleets. While the news of the acquisition is somewhat bullish, shares of Eagle Bulk Shipping Inc (NASDAQ:EGLE) are likely lower due to traders positioning for the company’s earnings report results for its fourth quarter and full year. The company is expected to release its results after market close on Thursday March 30. The earnings report could be a catalyst that causes a trend, or to cause the stock to eventually break out of its current range.

What Does The Smart Money Sentiment Say?

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 39.7% gains over the past 12 months and outperformed the 24.1% gain enjoyed by the S&P 500 ETFs. Our enhanced small-cap hedge fund strategy returned more than 45% over the last 12 months and outperformed SPY by more than 30 percentage points over the last 4.5 years (see details here).

In aggregate terms, the smart money crowd is more bullish. According to our data, 5 funds owned $71.29 million of Eagle Bulk Shipping Inc (NASDAQ:EGLE) and accounted for 25.30% of the float on December 31, versus 4 funds and $11.69 million respectively on September 30. Those numbers are out of 742 elite funds that we track. In terms of noteworthy activity, Steven Tananbaum‘s Goldentree Asset Management led the bulls, with a stunning 3664% increase to 11.09 million shares at the end of December. Those 11 million shares helped Eagle Bulk Shipping account for over 8% of the fund’s 13F portfolio at the end of the year.

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Ralf Gosch/Shutterstock.com

Ralf Gosch/Shutterstock.com