Investors who find sizable profits to be appealing—regardless of where they come from—will likely find them in two stocks recovering from the bust in the dry bulk shipping business, according to Barron's. Scorpio Bulkers Inc. (SALT) and Navios Maritime Partners L.P. (NMM) could rise as much as 50% over the next 12 to 18 months, stated David Marcus, who manages the Evermore Global Value Fund. (For more, see also: Shipping Stocks Encounter Volatility.)

"Up until two years ago I had never invested in shipping because I stay away from commodities," stated Marcus, Barron's reported. However, he identified some solid opportunities when this highly cyclical sector suffered a downturn in 2014 amid decelerating Chinese growth. "The best shippers and the bad ones were all trading at the same discount to the net value of their assets," said Marcus.

Plunging Stock Prices

Both Scorpio Bulkers and Navios Maritime Partners are down sharply from the highs they reached in 2014, according to Google Finance. The first company, whose stock rose to as much as $124.20 in January, was trading nearly 94% below this level at the time of report. The second, whose shares surpassed $20 in September 2014, was down nearly 90%. 

Improving Fundamentals

The dry bulk shipping industry is showing signs of improvement, according to Barron's. Companies operating in this space have been securing credit and using it to purchase ships. Chinese imports of coking coal have surged more than 20% this year, Evercore analyst Jonathan Chappell wrote in a recent note. He predicted that fleet growth will be 1.1% next year, the lowest since 1999. These variables could combine to cause dry bulk shipping prices to experience sharp increases. (For more, see also: Top 4 Coal-Mining Stocks as of October 2017.)

Amid these improvements, Marcus has predicted that Navios Maritime Partners, which has been trading slightly north of $2, could rise to as much as $3.50 or $4, while Scorpio Bulkers could reach $12 per share, Barron's. 

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