Despite fresh signs the U.S. economy may be stalling out, Goldman Sachs slapped a buy rating on DryShips (NASDAQ:DRYS), sending the drybulk shipping and oil and gas drilling company's stock soaring 7% Friday morning.
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.
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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 (NYSE:DSX) to neutral from buy due to oversupply of dry bulk ships.