Navios Stock Crashes After Newbuild Announcement

by John Konrad (gCaptain) Shares of Navios Maritime Partners $NMM fell 7.5% this morning after the company announced a six-ship order for mid-sized containerships.

Angeliki Frangou, CEO of the company, said she agreed to spend $246.4 million on four 5,300-ton newbuilds with an option for two additional ships. The ships will be delivered in late 2023 and 2024.

Following the delivery of the newbuilds, Navios Partners will have 43 containerships and 55 bulkers for a total of 98 ships in its diversified fleet. The total capacity of the fleet is nearly 9 million deadweight tonnage.

Along with the containerships, Navios Maritime Partners will acquire a newbuild Capesize and a Kamsarmax vessel for $60 million and $34.3 million respectively from undisclosed shipyards. Additionally, the company has purchased three secondhand Capesize ships.

“This diversified fleet should help insulate us from normal industry cyclicality concerns,” said Frangou. “Diversification will also help us leverage fundamental strengths across sectors while reducing our cost of capital.”

Navios Partners left its dividend payout unchanged at $0.05 per share, which is down significantly from 30 cents in 2019.

Navios Partners also confirmed a two-ship sale of the 2006 built, 2,824-teu Harmony N and the 2005 built 74,800-dwt Panamax bulker Navios Azalea.

Last week, an activist investor who has a 5.8% stake in the company, sent a letter to Frangou raising concerns about corporate governance and questioning recent financial decisions the company made.

Despite global congestion and red hot demand for ships, it has been a rough couple of months on Wall Street for both the shipping sector and Navios Maritime Partners stock. After hitting a high of $36.46 in May, the share price has fallen over 60% to $22.05 today.

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