PRGNF Paragon Shipping Inc (CE)

Despite better than expected third quarter earnings and stronger daily rents for panamax ships, most shipping stocks continue trading well off of 52-week highs. With more ships taking to the seas, and demand for iron ore and raw materials drying up, most analysts are concerned that shipping stocks could be in for a rough conclusion to 2011. The Bedford Report examines the outlook for companies in the Shipping Industry and provides investment research on DryShips, Inc. (NASDAQ: DRYS) and Paragon Shipping Inc. (NASDAQ: PRGN). Access to the full company reports can be found at:

www.bedfordreport.com/DRYS

www.bedfordreport.com/PRGN

After a strong finish to the summer, the Baltic Dry Index has once again fallen on hard times as a continued slowdown in cargo activity on the larger capesize market weighed on wider sentiment. Steel prices in China slid for a second month in October, weighing on demand for iron ore, a raw material. The price of ore imported into the Chinese port of Tianjin plummeted 31 percent in October, according to The Steel Index Ltd.

On the upside, Bloomberg reports that average daily rents for panamax ships surged 16 percent from the prior month to $15,670 in October, the highest level since March.

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Reports from Reuters state that the dry bulk fleet -- responsible for shipping iron ore, coal and other commodities -- was expected to grow 13 percent this year to top a record 600 million deadweight tonnes despite demand rising by just 5 to 8 percent.

Last week DryShips posted its first estimate-beating profit in four quarters, helped by increased revenues at its majority owned drilling unit. Third-quarter profit at DryShips was $25 million, or 7 cents a share, compared with $57.7 million, or 21 cents a share, a year ago. While DryShips posted a decent third quarter, share of DRYS have lost half of their value so far this year.

Shares of Paragon Shipping are presently trading more than two-thirds lower than their 52-week highs. Last month the company agreed to sell its 1995-built drybulk handymax vessel, of 43,222 dwt, M/V CRYSTAL SEAS, to an unaffiliated third party for a gross price of $14 million. The vessel is scheduled to be delivered to her new owners by no later than the end of November 2011.

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