What: Shares of dry bulk shipper Scorpio Bulkers climbed as high as 10% today after its quarterly results topped Wall Street expectations.
So what: Scorpio shares have been walloped over the past year on serious funding concerns, but a better-than-expected Q2 -- adjusted loss of just $0.09 per share versus the consensus loss of $0.11 -- is reigniting some hope on Wall Street for a triumphant turnaround. More important, the company reported that its cash cushion currently stands at roughly $450 million, suggesting that it has enough liquidity to survive until the Dry Bulk Index eventually recovers.
Now what: I wouldn't let today's double-digit pop prevent me from looking into the stock. While it may take a few years for the overall dry bulk industry to fully rebound, the new optimism surrounding Scorpio's financial situation, coupled with its still-very-attractive fleet of modern vessels, make the stock a particularly tempting turnaround play. With the shares still off considerably from their 52-week high, Scorpio seemsnicely suited for enterprising value hounds looking to get into the space.
The article Why Scorpio Bulkers Shares Popped 10% Today originally appeared on Fool.com.
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