Why Kirby Is a Buy, Buy, Buy
Carrizo Oil & Gas CEO Chip Johnson on Tuesday said people are shipping newly found oil in the U.S. by any means possible, including by barges.
To play it, Cramer is looking at the only one publicly traded inland barge player in the U.S.: Kirby . It has 829 barges and 249 towing vessels. It’s also the lowest cost operator thanks to economies of scale, Cramer added.
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The company mostly ships petrochemical products, accounting for 60 percent of its business. Its business is doing well because the more people are shipping product, the higher they can charge. In addition, low natural gas prices are making U.S.-made petrochemicals more attractive than foreign competition, Cramer said.
Right now, Kirby’s stock sells at 16.8 times forward earnings with a 15 percent growth rate, which is at the low-end of Kirby’s historical trading range. Cramer thinks this stock has room to run, too, and would consider buying shares.
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