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Greece Stocks: Buys and Sells in the 8 Biggest Greek ADRs (ANW, CCH, DRYS, DSX, NBG, NNA, OTE, TNP)


The economy of Greece is the 27th largest economy in the world by GDP — which makes it a rather small fish even among euro-zone member states. But as the nation’s recent debt troubles have shown, even a small economy can have a big impact on the world stage.

The euro strengthened today as Greece sold seven-year bonds to cover some of its massive debts, but investors remained anxious about the country’s long-term ability to finance itself at affordable rates. Greece raised about $6.75 billion in today’s auction, but at a steep coupon yield of 5.9% the nation could have trouble keeping another such bond auction within its reach.

Greece’s budget deficit stands at 12.7% of GDP for 2009 — four times over the European Union limit for member states — and has a total price tag of over $500 billion. But just because Greece in general is suffering does not mean that there aren’t some companies there worth a look.

Let me give you a rundown of some of the most widely held Greek ADRs — including two picks that are actually pretty good buys right now.

Greece Stock #1: Aegean Marine Petroleum (ANW)

Greece’s Aegean Marine Petroleum Network Inc. (ANW) operates a fleet of 20 tankers that supply fuel and lubricants to ocean-going vessels, such as containerships. The company operates service centers in Belgium, Britain, Ghana, Greece, Gibraltar, Jamaica, Singapore and the United Arab Emirates. As the dry goods shipping business and container business expanded in 2008, Aegean Marine continued to expand its fleet. It had as many as 27 ships on order, which are all expected to be delivered some time this year and will increase its fleet to nearly 50 ships, most of which will have double hulls for added safety. Though crude oil demand remains soft right now, if the economic recovery continues and tanker traffic picks up, ANW could be a great buy. Aegean Marine Petroleum has increased its earnings for each of the last four consecutive quarters, but it still may be a bit early to buy in.

Current recommendation: Hold

Greece Stock #2: Coca-Cola Hellenic (CCH)

Greece’s Coca-Cola Hellenic Bottling S.A. (CCH) is one of the largest Coca-Cola bottlers in the world. The company distributes carbonated soft drinks and other beverages, including juices, waters, sports and energy drinks and ready-to-drink coffees and teas in about 30 countries throughout Europe. Its brands include Coca-Cola, Sprite and Fanta, as well as Amita fruit juice and Avra bottled water. Additionally, the company distributes a handful of beer brands, including Amstel and Heineken. Coca-Cola Hellenic Bottling owns and operates approximately 80 production plants and 260 distribution centers. Consumer staples tend to be unaffected by the recent turmoil in Greece, and Coca-Cola products continue to sell well in this region.  Despite the woes over Greece’s debt, shares of CCG have surged about 17% year to date in 2010 and continue to show strength. This stock is likely to see continued growth in the months ahead.

Current recommendation: Cautious Buy

Greece Stock #3: DryShips (DRYS)

DryShips (DRYS) operates a fleet of about 40 dry bulk carriers. The company’s vessels carry commodities such as coal, iron ore and grain, as well as bauxite, fertilizers and steel products. The company has an overall capacity of more than 3.1 million deadweight tons and saw great growth when the global economy was humming, but has fallen on hard times as exports have slowed. Vessels are chartered to shipping companies largely on the spot market, but also on long-term contracts. DRYS was the talk of Wall Street in 2007, racing up 580% in 10 months from under $20 a share in January to about $120 a share that fall. Now shares are at a measly $6 a share and continue to drift sideways.  This stock is still suffering, and should not be considered a bargain even at these relatively low valuations. Avoid DryShips like the plague.

Current recommendation: Strong Sell.

Greece Stock #4: Diana Shipping (DSX)

Diana Shipping (DSX) provides shipping transportation service of dry bulk cargoes, such as iron ore, coal, grain, and other materials along worldwide shipping routes. As of 2009, its shipping fleet consisted of 13 Panamax dry bulk carriers and 6 Capesize dry bulk carriers with a combined carrying capacity of approximately 2 million deadweight tons. Diana saw a similar arc that DryShips did before the financial crisis, peaking in fall 2007 at over $40 and then dropping about 80% to under $9 when the market tanked in late 2008 and early 2009. Shares have “rebounded” to about $15, but are by no means a good investment when you look at the balance sheet of this shipper. Diana continues to suffer and is a bad buy.

Current recommendation: Strong Sell.

Greece Stock #5: National Bank of Greece (NBG)

As a “growth guy,” I typically don’t like many financial companies because they simply can’t post the sales and earnings growth I demand from all investments. National Bank of Greece (NBG) would likely not be on my buy list even in the best of times, but with the current financial environment in Greece it’s even less attractive. As a diversified financial services stock, NBG performs retail and commercial banking, as well as foreign exchange, investment services and treasury activities across 579 branches and 1,466 ATMs in Greece. Unfortunately, scale doesn’t matter when you’re lending to a fundamentally flawed economy so NBG is on my sell list.

Current recommendation: Sell.

Greece Stock #6: Navios Maritime Acquisition (NNA)

Greece’s Navios Maritime Acquisition (NNA) is a very intriguing investment right now, and has impressive potential even amid the nation’s debt troubles. That’s because NNA itself does not have significant operations, but is a very cash-rich company. As the euro zone is forced to raise key rates due to fiscal woes, this will cause this company’s reserves to generate huge interest in the bank. Why does NNA have so much idle cash? Well, the company plans to acquire assets or operating businesses through a merger, acquisition or stock purchase with its hefty similar business combination. Currently, Navios Maritime primarily focuses on target businesses in the marine transportation and logistics industries, including tankers, liquefied natural gas, as well as liquefied petroleum gas, containers and logistics sectors.  While Navios Maritime sits on a pile of cash in anticipation of a buyout, it is actually making good money. NNA earned $1.44 million in interest in its last fiscal year. This gives a lot of avenue for profit in NNA, and I think it’s a diamond in the rough among Greece stocks.

Current recommendation: Strong Buy.

Greece Stock #7: Hellenic Telecommunications (OTE)

Hellenic Telecommunications (OTE) serves residential and small business customers in Greece, Albania, Bulgaria and Romania. The company provides landline phone service, Internet access and mobile telecommunications services. Capitalizing on Greece’s seafaring economy, the company also provides telecommunications and e-commerce services through subsidiaries. As of 2009, the company had installed approximately 12,000 miles of fiber optic cable and offered broadband Internet services to approximately 1 million customers. However, the economic downturn in Greece and the negativity surrounding Greek equities have taken their toll. In February, OTE reported quarter-over-quarter sales of -7.05%, and that has weighed on Hellenic Telecommunications shares. The stock is down 16% so far this year and is likely to suffer eve more going forward.

Current recommendation: Sell.

Greece Stock #8: Tsakos Energy Navigation (TNP)

Tsakos Energy Navigation Limited (TNP), together with its subsidiaries, provides tanker shipping for crude oil and liquefied natural gas. As of March 31, 2009, it had a fleet of 46 double-hull tankers. Tanker stocks saw a similar wax and wane as the dry shipping stocks did in late 2007, and TNP got caught up in that trend. The stock has been moving sideways for months, with the only sign of life coming in January when shares gapped up to $18 before settling back in to the $14 a share we’ve come to expect for TNP. As with other tanker stocks, don’t expect Tsakos to improve until demand for fossil fuels and energy pick up markedly. Steer clear of this stock for now.

Current recommendation: Strong Sell.

Louis Navellier owned shares of NNA in personal or client portfolios as of this writing.

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