Dry bulk market rout

Dry bulk stocks saw one of their worst years in 2015, and 2016 has not been any better. In January 2016, the Baltic Dry Index, or BDI, has been hitting historical lows day after day. This has impacted market sentiment severely. Most market participants are quite bearish and do not expect any sustained pickup in dry bulk rates in 2016.

Navios Maritime Partners Falls in the Current Dry Bulk Rout

The bearish sentiment has led dry bulk stocks to slump to new lows. In the past year (as of January 25, 2016), Star Bulk Carriers (SBLK) has fallen by 93%. DryShips (DRYS) has followed Star Bulk, falling by 89%. Navios Maritime Holdings (NM) forms 2% of the Guggenheim Shipping ETF (SEA). Navios Maritime Holdings and Safe Bulkers (SB) have fallen by 76% and 89%, respectively.

Navios Maritime Partners (NMM) and Diana Shipping (DSX) have fallen by 82% and 63%, respectively. The SPDR Metals and Mining ETF (XME) provides exposure to the metals and mining sector.

The steep fall of Navios Maritime Partners

Since releasing its 3Q15 results on November 3, 2015, Navios Maritime Partners (NMM) has fallen by 71%. NMM cut its distributions by 52% from $1.77 per unit to $0.85 per unit annually. This, along with a deteriorating macro environment, has led the stock to hit 52-week lows several times.

In the next article in this series, we’ll see how Navios Maritime Partners’ dividend yield has moved historically. We’ll also discuss how Navios Maritime Partners compares to the MLP sector and the high yield bond market. This will put the company’s yield into perspective.

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