Wednesday, September 14, 2011

Penny Stocks Near Lows SBLK, GMR, HIMX

With strong sell offs in the market, penny stock traders began taking profits which in turn pushed prices to yearly lows. I am highlighting three penny stocks that are near their 52 week lows that may be a good time to get in cheep. The three penny stocks are HIMX a technology company located in Taiwan, GMR and SBLK two shipping penny stocks.

For other penny stock websites consider following the links provided by Google at the top of this blog.

Himax Technologies ADR (HIMX)
Recent price:$1.25
52 week range: 1.21 - 2.69
Market Cap: 240M

Himax Technologies is a Taiwanese based company that designs and manufacturers semiconductors used in flat panel screens and LCD screens. Their technology is used for desktops, laptops, mobile devices, digital cameras, gaming devices and portable DVD players to name a few.

HIMX unlike most penny stocks is profitable and is paying a nice dividend which is yielding around 9%.  Their industry is experiencing growth and there are many opportunities they can pursue to improve growth. One of the things I have noticed  is revenue for the past five years has been on a downward run.
HIMX dividend is very closely correlated to revenue and as revenue increases dividend increases should follow.

General Maritime Corp (GMR)
Recent price: $0.34
52 week range: 0.31 - 4.98
Market cap: 40.91M

This penny stock transports crude oil mainly from South American and Europe to the United States with 34 tankers in its fleet. Two thirds of its vessels are contracted to long term charters.

The main problem with GMR is supply and demand in the crude oil tanker business driven by production as seen in the chart below there has been some recovery from its drop off in 2008 but there needs to be a substantial increase in demand to offset GMR's losses.

Because of the growth in demand leading up to 2008 the tanker business became over supplied and as demand slowed spot prices fell as competition picked up squeezing profit margins for the entire industry. GMR also faces the possibility of de-listing by NYSE due to its stock price being under $1.00.

Star Bulk Carriers Corp (SBLK)
Recent price: $1.45
52 week range: 1.00 - 3.23

Unlike GMR this penny stock ships dry bulk cargo such as iron ore, cement, fertilizer, coal, grain and other dry bulk material. SBLK owns and operates 15 vessels in its fleet with an average age of 11 years.

SBLK has a very strong dividend of around 13.8%  or $0.20 per year with an EPS of $0.41 they should be able to maintain their dividend.

What I like about SBLK is they are paying a very nice dividend that helps offset some of the risk involved with this investment that appears to be sustainable. They should also experience increased demand as the world economy improves and grows. SBlK is expecting strong growth from China and India for coal and iron ore imports as the gap widens between demand and production; these countries will be forced to import more goods.

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Some of these penny stocks included in my portfolio here

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