Shipping industry = Deep value

Hi, and welcome to my blog.
This is my first thread, and I will attempt to put down my thoughts regarding the investment-ideas I am considering at the moment.

My best idea at the moment is related to the shipping industry, and more particularly the greek one.
I have scoured this part of the financial universe for the ideas I find most intriguing, and they are;
- GNK (Genco Shipping Industry)
- EXM (Excel Maritime Carriers)

Background:
The shipping industry is a cyclical one, and is highly correlated with the financial world as a whole.
The recent recession took a hard swing at shipping, and after a slow and cautious rebound, the BDI (baltic dry index - tracking the supply, demand and overall health of the shipping industry) has tanked once again. (With a historic average of around 2500, it is circling below the 2000 range)
Furthermore the recent european debt crisis with Greece smack in the middle of things, Greek shipping companies, and the two abovementioned in particularly shows promise of decent returns, with very little downside.

Company fundamentals and Fair Value:
GNK has shown relatively stable earnings over the last four years, ranging from EPS of 2.5-4.7.
It's recent P/E is 3.33 and P/B of around 0.5.
they are on their way to earning 4 $ pr. share in fiscal 2010.

Regardless of the wide swings in EPS, and a levered balance sheet I'd say they offer tremendous value at this price, and very little has to go well for this company in order for them to do well.

I'd say their fair value, computed on a conservative basis, ranges between 30 and 50, so at least 50 % downside is reasonable to expect.

EXM tells the same story:

P/E of 1.68 and P/B of .30.

They are not as well managed as GNK, earnings have fluctuated in recent years - from a loss of 1.53 in fiscal 2008, to 4.85 in 2009, but offers a less levered balance sheet, and more value for the dollar.

Again, very little needs to go right in order for investors to make money and the upside is limited.

In my estimates fair value starts at 20 $.

Conclusion: 
Both companies offer good upside and limited risks, in an industry that seems to have hit the bottom and is set for a rebound.

Disclosure: Both companies will be added to my portfolio in the beginning of january.