Is The CTRM Castor Maritime STOCK A Good Investment Opportunity?

What is happening to Castor Maritime Inc.? This has been the big question investors’ have been asking about this stock. Should you invest in it or not?

There’s a lot of news about the NASDAQ: CTRM with the recent dumping of this stock.

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But let’s take a look at this company. Castor Maritime Inc. (CTRM) is one of the shipping companies that was established on September 12, 2017. The company operates in Limassol, Cyprus.

It provides transportation services through the marine shipping.

In the industrial sector, CTRM stock (NASDAQ: CTRM) has been dropping for a few months now after its establishment in 2017.

The stock share price had peaked high in its earlier operations. Since then, the prices have been dropping. As of Wednesday 26 January 2022, the CTRM stock was trading at around 1.17 US dollars with +7.34%. Few shares were traded on this day.

This has brought much concern to the investors despite this week’s gains. The stock is under Micro Cap stock worth 106.91 million USD.

Now, what is the big deal with this stock? Well, the company’s aim of delivering dry bulk is the bigger deal. Based on the BDI (Baltic Dry Index), CTRM can set its charter rates.

The rates have now gone up due to an increase in the demand for dry bulk materials. The result has led to an decrease in cash flow.

Second, the management of CTRM has played a bigger role in the dip of this stock. Let’s see what this has to do with the dump. The focus is primarily based on the company’s management and the shares.

The shares are provided in the following categories; Series A, B, and C Preference Shares. This has been stated in the company’s policy.

Liquidating the Series A Preference shares has shown effects on the stock prices. The Series A preference shares were redeemed resulting in a pay-out of 14.4 million that constituted 34% of the CTRM cash in hand.

This occurred on November 8, 2021, as published in the company’s Q3 2021 earnings report. According to the book value, this resulted in a decrease of about 14 cents for each share.

On the other hand, the Series B Preference shares (the common shares) and Series C have no effects on the drop of the shares. Despite this, the company has experienced a tremendous growth rate on the prices of the common shares.

As of 31 September 2021, the company’s common shares had increased to 39000% worth 94.6 US dollars. Notwithstanding, the net asset had also increased signifying that the company was, and is still growing despite the stock dropping.

Let’s have a look at the management part. Petros’ incentive to increase the company’s gross assets through the rise of the equity, will result in over-leveraging of the stock. By doing so, the interest will decrease reinvestment of the cash.

Any changes be it raising the company’s equity, will have no effect on the share price.

Therefore, the future share price of the CTRM will be a bit wavy and risky. Investors should consider it as profitable on the common shares, you will have to buy knowing that you will transfer them to other shareholders.

The common shares have been regarded as valueless on the stock platform. The reason behind this is, the interest to reward ratio for Petros will be violated considering that controlling managers, directors, or shareholders have control over the common shares.

There’s not much talk about the liquation of the company since it is making a profit. The management is running smoothly despite the stock falling price.

On the investment of the stock, the bears have a great reward to ratio as the stock is bearish on momentum. Plus the unresolved issues of unpaid dividends to the shareholders have contributed to this dumping.

There are three possibilities for this stock. First, the stock price is likely to have its support at 1.00 or 0.5 USD. As of January 26, 2022, the support level had been broken.

This gives an insight that the stock price will dump down to 0.5 USD then correct toward the resistance level.

This gives much confidence to go short. If the price goes back to the supply zone without holding the resistance (1.18 USD), then this gives signals to go long.

Patience will be crucial for long-term investors if this happens. As per analysis, 1.36- 3.20 USD dollars may be achieved if the bulls step in for the stock to go up.

And we have seen the Reddit community of investors get behind $CTRM before thus anything is possible.

In the same industrial category, there are some other companies that have shown good returns on investment. We shall look at which other stocks to invest in the shipping sector.

Their growth rate has been ranked by their model with a score of 50/50 weighing on their quarterly YOY percentage of the revenue growth.

Not forgetting about their rank on the quarterly YOY earning-per-share (EPS) growth. Therefore, these are the best-growing shipping companies to invest in the penny stock market; ZIM Integrated Shipping Services Ltd. (ZIM: NYSE), Navios Maritime Partners LP (NYSE: $NMM), Costamare Inc. (NYSE: CMRE), Danaos Corp (DAC)., and Golden Ocean Group Ltd (GOGL).

ZIM Integrates Shipping Services Ltd. is one of the international leading cargo shipping company. They have over 20 global carriers. The company is located in Haifa, Israel. The stock price of this company is estimated to be 57.22 USD as of 26 January 2022.

$ZIM quarterly records have shown great improvement signifying that the company is doing well. With the previous charter agreement running for eight- years, CEO Eli Glickman stated that the company can now help their customers on reducing their carbon footprint.

The analysts have forecast significant earnings on this stock. The curve indicates good performance since its IPO. The company has been having some negotiations with the Israeli government on tax reduction.

With this, taxation will be similar to that of the liners pay as the corporate tax rate of 23% will be reduced to global standard tonnage tax.

In addition, any structural change will add a huge advantage to the company and its shareholders.

Navios Maritime Partners LP offers transportation services of maritime freight. The headquarters of the company is located in Greece. It is one of the best shipping companies having a growth of YoY 23 fold revenue tripling over years of operation.

This came from voyage revenues and an increase of substantial time on the dry cargos and tanker vessels.

The company has generated revenue of 227.96 million US dollars since September 2021 with a net profit margin of 71.09%.

On Wednesday 26 January 2022, the market cap was 746.17 million US dollars, and stock price (NYSE: NMM) of 25.10 US dollars each with a gain of +3.04%.

Costamare Inc. is a shipping company based in Athens, Greece. It has been in business for 47 years.

The company is listed on the New York Stock Exchange as common shares ($CMRE), Series B Preferred Stock (CMRE PR B), Series C Preferred Stock (CMRE PR C), Series D Preferred Stock (CMRE D), and Series E Preferred Stock (CMRE PRE).

The quotes price of the share are $11.87, 25.91, 26.35, 26.05, and 26.99 each as on Tuesday 25 January 2022.

Danaos Corporation after its establishment in 1972, has provided services of shipping containerships of modern and large-sized. It operates in Attica, Greece.

As of 25 January 2022, the company is approximately 1.6 billion US dollars.

Revenue of 195.92 million US dollars and net profit margin of 110.88% since September 2021 have been recorded.

It looks like this company is doing well. The market cap price of each share (NYSE: $DAC) was 79.17 US dollars on 26 January 2022.

The price has been in a range after there was a massive bullish momentum in the last one year period.

Good returns upon the investment have shown that still investors have another chance to invest. This is after a price range currently experienced before prices shut again.

Golden Ocean Group Ltd. is another shipping company based in Norway. It was formed in 1996 aiming to offer transportation of dry bulk. The stock price (NASDAQ: $GOGL) of the company is 8.46 US dollars with a gain of 2.30 % from 26 January.

The company provided revenue of approximately 388 million US dollars and a net profit margin of 50.29% from Sept 2021.

The stock shows bullish momentum. With this, investors are looking for a pullback on a correction that will provide an entry point.

Is the stock worth investing in? The stock (NASDAQ: $CTRM) has shown risk as upon investing, will give you a return of -75%. In the last 4 months, shows returns of around -57%.

With this data, my view on the investment of these penny stock shares is; investors should not buy them. Rather, they should look for shorting the stock.

The prices will still go down until the issue of the Q4 income of the shares on class A preference shares have been resolved.

With the demand to supply ratio balances, there will be not much concern about the stock.

The overall recovery will peak and stock NASDAQ: CTRM will go up with balance in place.

One possible investing move to consider would be to buy all in and forget. Or half buy in now, and if the price drops significantly, then go all in with the other 50% you had set aside. This would give you more value in any averaging down move.

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