Despite fresh signs the U.S. economy may be stalling out, Goldman Sachs slapped a buy rating on DryShips (DRYS), sending the drybulk shipping and oil and gas drilling company's stock soaring 7% Friday morning.
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According to Dow Jones Newswires, Goldman upped DryShips from neutral and raised its price target to $6 from $5.50 due in part to an attractive valuation. The price tag looks more affordable after having plunged by nearly half over the past six months.
Goldman believes the company Greek companys drillship business is likely underestimated and sees a positive risk/reward ahead of the upcoming listing of its Ocean Rig unit in the U.S, the wire service reported. Analysts also believe DryShips, which was once a $120 a stock, has sufficient liquidity.
Shares of DryShips rallied 7.57% to $4.13 on the Goldman note, trimming their 2011 loss to a still-hefty 30%. The companys stock has lost 15.6% of its value over the past 52 weeks.
In contrast to the DryShips call, Goldman downgraded Diana Shipping (DSX) to neutral from buy due to oversupply of dry bulk ships.