Cantor Fitzgerald Downgrades General Maritime (GMR) to Sell; Cash Flow Problems Intensify

Cantor Fitzgerald downgraded General Maritime (NYSE: GMR) from Hold to Sell, price target cut from $1.00 to $0.05.

Cantor analyst says, "Yesterday, after market close, General Maritime announced that it reached an agreement with its lenders to amend its credit facilities to waive the minimum cash balance covenant until November 10, 2011. The company also announced that it has entered into discussions with its lenders and other creditors regarding a potential restructuring of its capital structure."

"We note that GMR has been particularly vulnerable to the depressed tanker market environment due to its high leverage and low period charter coverage. We suggest that current tanker spot rates are not providing sufficient cash flow for the company to continue paying its scheduled debt payments on an ongoing basis, and as such, we believe that a bankruptcy filing could be an option in the near future."

For more ratings news on General Maritime click here and for the rating history of General Maritime click here.

Shares of General Maritime closed at $0.20 yesterday.

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