Off The Charts – NAT & DSX

For the “Off The Charts” segment, Cramer went up against his colleague Dan Fitzpatrick at TheStreet.com over the charts of Diana Shipping Inc. (DSX) and Nordic American Tanker Shipping Limited (NAT) to see which bulk shipper was the best investment. Fitzpatrick said the chart of Diana Shipping shows the stock trading in a tight range, between $12 and $15, since July, and now volatility in the stock appears to suggest a big move to the upside is in the cards. “The weekly chart of Diana Shipping, a dry-bulk carrier, shows a stock with the potential to explode,” Cramer said. However, the daily chart suggests the stock might be a bit ahead of itself, with DSX 21% above its 50-day moving average. Fitzpatrick recommended that investors wait for Diana to pull back to $15 before jumping in. Fitzpatrick also likes the chart for Nordic American Tanker.  The stock had recently been in a trend where it sold off every time it hit the 50-day moving average. However, last week NAT broke out on big volume, which is normally a sign of higher prices to come.  Moving on to the fundamentals, Cramer mentioned that day rates are coming back, after rising 30% last week, and he thinks they will go even higher. He said Diana Shipping is the best positioned bulk shipper to meet the rising demand due to their cash on hand to expand their fleet. Their solid balance sheet will allow the company to add nine ships to its current fleet of 21. Cramer explained the company could use the rising shipping rates to bring back its dividend, which was suspended in the fourth-quarter of 2008. “Investors should take note, because before the suspension Diana often paid nearly all of its distributable cash flow to shareholders,” he said. Cramer was also bullish on Nordic American Tanker. The move up in oil prices helps NAT and also China’s ban on single-hulled tankers, due to environmental reasons, puts the company in the sweet spot. Cramer pointed out that the company cut its dividend last week, but the stock still traded up, which he called “a major show of strength.” “As rates rise and new ships come on line the dividend should roar back,” Cramer said. He told viewers while Diana Shipping is a buy, Nordic American is now a raging buy. Get the scoop on tomorrow’s hottest trade ideas – TODAY! BeaconEquity.com PREMIER PICKS have an amazing track record. Join this select group and ride the profit wave!

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