Seanergy Maritime Holdings Corp. (NASDAQ: SHIP) stock recovers post weakness

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Seanergy Maritime Holdings Corp. (NASDAQ: SHIP) stock plunged 15.13% on June 30th, 2020 (Source: Google finance) but recovered over 7% in the pre-market session of July 1st, 2020 (Source: Google finance).  The company announced a plan to go ahead with a 1-for-16 reverse stock split, in order to comply with Nasdaq listing regulations. The company had until September 25 to get the share price up to the required $1 minimum listing price, but then it decided to resolve the matter beforehand. The split had to go into effect on June 30. Evidently, the investors are anticipating that the shares will sink further once they start trading on a split-adjusted basis. Last week the company’s stock surged by 40% after capesize shipping rates reached 2020 highs. According to Maxim analyst Tate Sullivan, he believes that the rising shipping rates bode well for the rest of the year. As per him, since the first quarter of 2020, the average daily TCE (time charter equivalent) rate of the Capesize Index have risen to about $29,400, from levels as low as $2,000 in May 2020 during volatile shipping rates as the world adjusted to COVID-19. The analyst has maintained the Buy rating with the price target of $0.30 based on the outlook for SHIP to benefit from a rebound in international shipping activity and higher rates.

On the other hand, SHIP in the first quarter of FY 20 has reported the adjusted loss per share of 31 cents, beating the analysts’ estimates for the adjusted loss per share of 32 cents. The company had reported the adjusted revenue growth of 13 percent to $7.64 million in the first quarter of FY 20, beating the analysts’ estimates for revenue by $0.34 million.

Meanwhile, the company had expanded the business relationship with Glencore through the addition of a third vessel under a commercial arrangement that Seanergy has pioneered in the sector. The M/V Knightship was delivered to Glencore in May for a period of up to five years after her dry-docking and scrubber installation. Currently, 70% percent of the company’s fleet is employed under index-linked time-charters, taking advantage of the steep improvement in Capesize rates.

Additionally, in March 2020 the company hd completed the previously announced refinancing of $30.6 million of indebtedness due in the first quarter of 2020, extended the maturities of two loan facilities secured by the M/V Leadership and M/V Squireship. The company was in finalizing discussions with existing and new lenders to address upcoming loan maturities.

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