Adjusted 2Q2020 EBITDA of $0.2 million was weaker than expected due to lower TCE rates of $7,297/day. 1Q2020 TCE revenue of $4.3 million was below expectations by $0.5 million, as TCE rates tied to indices were lower than expected. The fleet included 7.0 vessels and ownership days were 637, while TCE rates dropped to $7,297/day from $7,885/day in 1Q2020. Relative to our estimates, TCE rates were ~$600/day lower, and shipping days of 595 were 17 lower.Fine-tuning 2020 estimate mainly due to 2Q2020 shortfall. Following the management call, we are moving our adjusted 2020 EBITDA estimate lower to $5.4 million based on TCE rates of $8,724/day, down from $5.7 million based on TCE rates of $8,684/day. We are forecasting that TCE rates remain firm in 3Q2020 following the earlier than expected rebound in June, but shipping days are expected to be lower.Limited change in financial position. Total cash dropped $2.0 million to $4.4 million and total debt dropped $0.8 million so net debt increased $1.2 million to $50.4 million.Preferred dividends now payable in kind and debt amortization pushed out. Debt refinancing is likely by year end 2020. In advance of a step up in the dividend rate, we had expected a partial/full redemption of the preferred. Unfortunately, the 1H2020 dry bulk market weakness has pushed out that time frame. The preferred was modified in 2Q2020 to allow the dividends to be paid in kind for the remaining three quarters of 2020 in return for a rate increase of 100 basis points. In addition to the relief on the preferred dividend, the 2H2020 debt amortization of $1.4 million on the Eirini/Pantelis/Tasos debt was deferred and added to the balloon payment due in 2021.Maintain Outperform rating and price target of $10/share. YTD stock price weakness in the 47% range has created a favorable risk/reward profile. EuroDry remains a pure dry bulk market play and is an attractive was to play a sustained dry bulk market rebound. The fleet profile is attractive, and EDRY should benefit if the 2H2020 recovery in dry bulk market fundamentals proves sustainable.Read More >>