Tomahawk, WI 12/02/2013 (BasicsMedia) – DryShips Inc. (NASDAQ:DRYS) still stands out as a leading company in the shipping industry. The industry was been on a poor performance for quite sometime now and this year has been particularly rough for DRYS.

While there is a wave of optimizing coming from the improving coal and ore important to such markets as China, Brazil and Australia, the situation is till very fluid for DryShips Inc. (NASDAQ:DRYS) and its peers in the bulk and dry shipping sector. While the company was expected to post a loss in its Q3 results, the loss which came was bigger than expected.

The company posted $64 million in loss compared to $51 million in the corresponding quarter of the year before. It is however important to note that its revenue was better than consensus estimate at $405 million against $343 million in estimate.

Perhaps a weakening bottom line may not worry as much as worsening debt situation. DryShips Inc. (NASDAQ:DRYS) reported a jump in debt to capitalization ratio from 0.52 to 0.58. This signifies that its debts are spinning out of control, or like they say, the management is herding cats in the category.

Put aside bulging debts and pick the growing expenses. Every company today is seeking to reduce operating cost if only the bottom line can remain stable. But this is something that has refused DRYS going by its recent reporting. The company noted increase in its expenses by more than 6% in the Q3 operations.

When you combine a slow economy, poor shipping rates, competition, weak financials, debts and growing expenses, DryShips Inc. (NASDAQ:DRYS) emerges as an endangered stock. Even the fact that the stock is up about 100% year to date doesn’t seem consoling.

If the situation continues this way, it’s likely that the management might take another dilutive step to stay afloat. But this isn’t good news for investors.

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