Breaking Down EuroDry Ltd. (EDRY) Financial Health: Key Insights for Investors

You're looking at EuroDry Ltd. (EDRY) and trying to map the dry bulk sector's volatility to a clear investment thesis, and honestly, the Q3 2025 numbers show a classic shipping tightrope walk. The headline is a net loss of $0.7 million (or a $0.24 loss per share), but don't stop there, because the company's operational cash flow story is much stronger, with Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) coming in at a solid $4.1 million. This is a company with a current market capitalization of about $38.87 million as of mid-November 2025, actively restructuring its fleet of 11 vessels, which is why their nine-month net revenues dropped to $34.9 million; they sold an older Panamax for $8.5 million and are planning two new Ultramax vessels for 2027. They're smart to be patient, holding out for longer-term Time Charter Equivalent (TCE) rates above their cash-flow break-even of just under $13,000 per day, which is the real action to watch.

Revenue Analysis

You need to know where EuroDry Ltd. (EDRY)'s money comes from, and right now, the top-line trend is a clear headwind. The company's revenue is nearly all derived from a single source: providing seaborne transportation for drybulk cargoes, which means chartering out their fleet of drybulk vessels. This is a pure-play shipping stock, so revenue success hinges entirely on two variables: the number of vessels operating and the Time Charter Equivalent (TCE) rate, which is the daily revenue per ship after voyage expenses (like fuel and port fees) are paid.

For the first nine months of 2025, EuroDry Ltd. (EDRY) reported total net revenues of just $34.9 million. That's a significant year-over-year drop, mostly due to a weaker market and a smaller fleet. The average TCE rate for the first nine months of 2025 was $10,210 per day, a sharp decline from the $13,339 per day earned in the same period of 2024.

Here's the quick math on the near-term revenue contraction:

• 9M 2025 Total Net Revenue: $34.9 million
• 9M 2024 Total Net Revenue: $46.6 million
• Year-over-Year Revenue Decrease (9M): 25.1%

That 25.1% revenue decrease is the number that matters most for the near term. It tells you the market conditions have been tough, plus the company has been actively reducing its fleet size as part of a renewal strategy. To be fair, Q3 2025 showed some stabilization, with net revenues of $14.4 million, only a 2.2% decrease from Q3 2024, as the TCE rate actually ticked up slightly to $13,232 per day.

The core business is one segment, but the revenue mix is shifting as they sell older vessels and wait for new, eco-friendly ships. This fleet restructuring is the most significant change in their revenue profile. The sale of M/V Tasos in Q1 2025, for instance, removed a revenue-generating asset but provided a one-time gain on sale of $2.1 million. This non-core revenue boosts liquidity but doesn't reflect the daily charter market. For the full fiscal year 2025, based on the nine-month actuals and projecting Q4 revenue slightly above Q3 at $15.0 million due to anticipated market strength, we can estimate total net revenue to be around $49.9 million. This would represent an estimated year-over-year revenue decrease of about 18.5% from the 2024 full-year revenue of $61.1 million.

What this estimate hides is the potential for a Q4 drybulk market surge, which could push that final number higher. You can dive deeper into the ownership structure and market sentiment in Exploring EuroDry Ltd. (EDRY) Investor Profile: Who's Buying and Why?

Here is a breakdown of the 2025 nine-month performance:

The primary risk is continued weakness in the drybulk market, as lower rates directly translate to lower revenue, even with a stable fleet size. The opportunity is that the market is showing signs of recovery, which could lead to a much stronger Q4 and 2026 as the new, eco-friendly vessels start to come online in the future.

Profitability Metrics

You need to know the hard numbers on EuroDry Ltd. (EDRY)'s profitability to make an informed decision, and the picture for the first nine months of 2025 (9M 2025) shows significant pressure. The company is operating at a loss, driven by a softer dry bulk market and lower charter rates. For the first nine months of 2025, EuroDry Ltd. (EDRY) reported total net revenues of $34.9 million and a net loss attributable to controlling shareholders of $7.4 million.

Here's the quick math: that $7.4 million loss on $34.9 million in revenue translates to a Net Profit Margin of approximately -21.2% for the nine-month period. This is a clear indicator of the challenging environment and the company's struggle to cover all costs, including financing. To be fair, the dry bulk market is volatile, but this still represents an increase in the net loss from $6.4 million in the same period of 2024.

Margin Comparison and Operational Efficiency

When we look at the Trailing Twelve Months (TTM) margins-the most recent full-cycle data available-the gap between EuroDry Ltd. (EDRY) and the industry average is stark. The dry bulk shipping sector is cyclical, but operational efficiency (cost management) is key to navigating the downswings. The trend suggests a significant deterioration in gross profitability over the past five years.

The TTM Gross Margin of 27.77% is notably below the industry average of 34.89%, which signals that the company's direct costs of revenue (vessel operating expenses, voyage expenses) are consuming a larger piece of the revenue pie than its peers. The drop from the 5-year average of 51.96% is defintely a red flag for cost management or, more likely, a reflection of the steep decline in charter rates outpacing cost cuts.

The negative Operating Margin of -14.55% is the real pain point, showing that the company isn't even covering its core operating expenses (like general and administrative costs) before accounting for interest and taxes. This is a massive underperformance compared to the industry's positive 21.88% average. This is a function of the market, but also an operational challenge. You can see how management is trying to focus on long-term strategy, though. Mission Statement, Vision, & Core Values of EuroDry Ltd. (EDRY).

Near-Term Risks and Opportunities

The trend in profitability is clearly negative. Net revenues for 9M 2025 fell by 25.1% from the same period in 2024, largely because the average Time Charter Equivalent (TCE) rate dropped from $13,339 per day to $10,210 per day. That's a huge headwind. The company is actively restructuring, selling an older vessel and securing financing for new, more efficient Ultramax vessels, which should eventually help the gross margin through better fuel economy and lower operating costs. But for now, the risks are tied to the weak freight market and the high fixed costs of vessel ownership.

• Monitor the Average TCE rate for Q4 2025; it needs to climb above $13,000/day to materially improve the margin.
• Watch for signs of cost-per-vessel-per-day reduction to show improved operational efficiency.

The immediate action for an investor is to recognize that EuroDry Ltd. (EDRY) is in a capital-intensive fleet renewal phase during a market slump, which is why the margins are so poor. Finance: Model a scenario where the TCE rate averages $15,000/day in 2026 to see the potential for a return to positive operating profit.

Debt vs. Equity Structure

You're looking at EuroDry Ltd. (EDRY) and wondering how they pay for their fleet-it's a capital-intensive business, so the debt-to-equity mix (financial leverage) is defintely the first place to look. The direct takeaway is that EuroDry Ltd. is operating with a moderate level of leverage for the dry bulk sector, but it's a bit higher than some of its larger, more diversified peers.

As of September 30, 2025, EuroDry Ltd.'s total debt stood at approximately $101.3 million against a total shareholder equity of $99.4 million. This gives us a Debt-to-Equity (D/E) ratio of about 1.02:1 (101.9%). For a shipping company, which relies heavily on borrowing to finance multi-million dollar vessels, a 1:1 ratio isn't alarming, but it signals a balanced, rather than conservative, approach to financing growth.

Here's the quick math on their current debt load:

• Total Outstanding Debt (Q3 2025): $97.9 million
• Current Portion of Debt (Next 12 Months Repayments): Approximately $12.5 million
• Total Shareholder Equity: $99.4 million

The $12.5 million in scheduled repayments over the next year is a manageable near-term obligation, especially since the company reported $11.9 million in cash and restricted cash as of the same date. That's tight, but they've been actively restructuring their fleet to manage liquidity.

To be fair, a 1.02:1 D/E ratio is higher than some major dry bulk peers. For instance, Star Bulk Carriers (SBLK) reported a much lower D/E ratio of around 0.57:1 as of Q3 2025. However, EuroDry Ltd.'s ratio is in line with or lower than other comparable companies in the dry bulk space, where ratios can sometimes climb to 1.5:1 or higher. The shipping industry is capital-intensive, so debt is a necessary tool. The key is that their net debt-to-equity ratio, which accounts for cash, is slightly lower at 95.6%.

EuroDry Ltd. is actively using debt to fund its fleet renewal and expansion, which is a clear opportunity but also a risk. They recently announced term sheets for significant debt financing arrangements to pay for their two new Ultramax bulk carriers, which are slated for delivery in 2027. This new debt includes up to $39.5 million from Eurobank and a $26.9 million loan from Crediabank. They balance this debt by using a combination of debt and equity to finance new vessels, plus they sold the M/V Eirini P vessel for approximately $8.5 million in October 2025. This sale helps fund the new builds and keeps the overall leverage ratio in check, which is a smart move to manage the balance sheet. For a deeper dive into the company's full financial picture, check out the full post: Breaking Down EuroDry Ltd. (EDRY) Financial Health: Key Insights for Investors.

Liquidity and Solvency

You need to know if EuroDry Ltd. (EDRY) can cover its short-term bills, especially in a volatile market like dry bulk shipping. The direct takeaway is that their liquidity position is tight but manageable, supported by a positive working capital and strategic asset sales that bolstered cash. Their focus is on fleet renewal, and that shows up in the financing activity.

Current and Quick Ratios: A Tight but Positive Stance

As of September 30, 2025, EuroDry Ltd.'s liquidity ratios show they can currently meet their obligations, but without a huge cushion. The Current Ratio is 1.27 (Current Assets of $23.13 million divided by Current Liabilities of $18.24 million). A ratio above 1.0 is good, but 1.27 is not defintely a blowout number.

The Quick Ratio (or acid-test ratio), which strips out inventories to measure the ability to pay debts immediately, is just slightly lower at 1.21. This is calculated by taking Current Assets, subtracting Inventories of $1.13 million, and dividing by Current Liabilities. The small difference between the two ratios is typical for a shipping company, as vessel spares and lubricants (Inventories) are a small part of their total current assets.

• Current Ratio: 1.27 (Manageable short-term coverage).
• Quick Ratio: 1.21 (Strong ability to cover immediate debts without selling inventory).

Working Capital and Cash Flow Trends

The company maintains a positive Working Capital of approximately $4.90 million ($23.13 million - $18.24 million). This positive figure indicates that its short-term assets exceed its short-term debts, which is the bare minimum you want to see. The trend in working capital has been supported by active management, including the sale of the older vessel M/V Eirini P for $8.5 million, which immediately boosted cash.

Looking at the cash flow statement for the first nine months of 2025 (9M 2025), the picture is mixed but shows operational resilience:

The $5.17 million in Net Cash Provided by Operating Activities for 9M 2025 is a critical strength, showing the core business is still generating cash, even with a net loss of $7.45 million for the same period. Here's the quick math: depreciation and non-cash items are adding back enough to offset the net loss. The company also lowered its daily cash flow break-even level to $12,071 per vessel per day for 9M 2025, which is a significant operational win.

Potential Liquidity Concerns and Strengths

The main liquidity concern is the reliance on the dry bulk market's volatility, as most Q3 charters predated the recent market upswing, meaning future operating cash flow is highly dependent on sustained higher rates. However, management took clear actions to mitigate near-term risk, improving liquidity by approximately $15 million through refinancing and vessel sales. This proactive balance sheet management is a major strength. The new financing for the Ultramax vessels, while adding long-term debt, is a strategic investment that will improve the fleet's fuel efficiency and long-term earnings potential. For a deeper dive into who is betting on this strategy, you should read Exploring EuroDry Ltd. (EDRY) Investor Profile: Who's Buying and Why?

Valuation Analysis

You're looking at EuroDry Ltd. (EDRY) right now, trying to figure out if the market has it priced correctly. Given the cyclical nature of the dry bulk shipping sector, simple earnings multiples can be defintely misleading. The short answer is that, based on book value and enterprise value metrics as of late 2025, the stock appears to be trading at a significant discount, but its negative earnings keep the overall picture complex.

As of November 2025, EuroDry Ltd. (EDRY) is trading around $13.38 per share. Over the last 52 weeks, the stock has seen a wide swing, ranging from a low of $7.60 to a high of $16.14. This volatility is typical for the industry, but the 15.03% price increase in 2025 suggests a recent, strong bullish trend in the near-term. Still, you need to dig into the core valuation ratios to see the real story.

Here's the quick math on the key valuation multiples, which paint a clear picture of the market's view:

• Price-to-Earnings (P/E) Ratio: The TTM (Trailing Twelve Months) P/E ratio is -3.33. A negative P/E means the company is currently reporting a loss, so this ratio is not useful for traditional valuation. It immediately signals a near-term profitability challenge.
• Price-to-Book (P/B) Ratio: This is the most crucial metric for an asset-heavy company like a shipping firm. EuroDry Ltd.'s P/B ratio is a low 0.3817. This means the stock is trading for less than 40 cents for every dollar of its net asset value (book value), which typically suggests the stock is undervalued.
• Enterprise Value-to-EBITDA (EV/EBITDA): The LTM (Last Twelve Months) EV/EBITDA is 7.6x. For the shipping industry, a ratio below 10x is often considered reasonable, so 7.6x indicates a fair-to-undervalued assessment of the company's operating performance before interest, taxes, depreciation, and amortization.

The low P/B ratio is a huge flag for value investors; you are essentially buying assets for cheap. However, the negative P/E ratio is an equally large risk flag. The market is telling you that the company's assets are worth more than its market cap, but it's also losing money on operations, which is why the stock is trading at a discount to its book value. For more context on the long-term strategy that drives these figures, check out the Mission Statement, Vision, & Core Values of EuroDry Ltd. (EDRY).

What this estimate hides is the market's concern over future charter rates and the dry bulk market's volatility. The analyst consensus reflects this mixed signal. As of November 2025, the stock holds a Zacks Rank #3 (Hold), meaning analysts expect it to perform in line with the overall market, not significantly outperform or underperform. Finally, as a note for income-focused investors, the company has a 0.00% dividend yield, confirming it is not currently focused on returning capital through dividends.

Next step: Dig into the balance sheet to confirm the quality and liquidity of those assets backing the low P/B ratio. Finance: review fleet age and debt structure by end of week.

Risk Factors

You're looking at EuroDry Ltd. (EDRY) and the dry bulk market is confusing right now, so let's cut through the noise. The core issue for EDRY isn't a single flaw, but its exposure to a volatile global trade environment coupled with a need for capital to modernize. The company reported a net loss of $0.7 million for Q3 2025, a clear signal that external pressures are hitting the bottom line.

The biggest near-term risk is the industry's supply-demand imbalance. While demand for dry bulk cargo-like iron ore and coal-is expected to remain soft, the Supramax and Ultramax fleets, which make up a significant portion of EDRY's fleet, are projected to grow by up to 5% in 2025. This oversupply depresses charter rates, meaning EDRY's average Time Charter Equivalent (TCE) rate of $13,232 per day in Q3 2025 is constantly under threat. That's a tight margin to operate on.

External and Market Headwinds

The dry bulk sector is defintely a high-beta play on global trade, and right now, global trade is a mess. Geopolitical risks are forcing costly detours, like the Red Sea tensions, which disrupt key shipping arteries and drive up insurance and bunker (fuel) costs. Also, EDRY is heavily exposed to China's economic health; the projected 3% decline in Chinese iron ore imports in 2025 is a direct headwind to their Capesize-related trade.

You also have to factor in the regulatory burden, or what we call 'green transition' costs. New environmental regulations like the Carbon Intensity Indicator (CII) and the EU Emissions Trading System (EU ETS) are increasing operational expenses and may force older, less efficient vessels-which EDRY still operates-to slow steam or be scrapped prematurely.

• Geopolitical risk: Houthi attacks disrupt Red Sea routes.
• Trade risk: Chinese iron ore imports projected to decline 3% in 2025.
• Regulatory risk: EU ETS compliance raises operating costs.

Operational and Financial Risks

Looking internally, the company's financial results for the first nine months of 2025 show the strain. Total net revenues for the nine months ended September 30, 2025, were $34.9 million, a 25.1% drop from the same period in 2024, leading to a net loss of $7.45 million. This is primarily due to a lower average number of vessels operated and decreased charter rates. The company is managing a total debt of $97.9 million as of September 30, 2025, against a cash position of just $11.9 million. That debt-to-cash ratio is something to monitor closely.

Mitigation and Strategic Actions

To be fair, management is taking concrete steps to de-risk and strengthen the balance sheet. Their strategy is a classic fleet renewal play: sell older, less efficient ships and use the capital to finance new, modern tonnage. For example, they sold the M/V Eirini P, a 2004-built Panamax, for $8.5 million. This, along with new financing arrangements, increased their liquidity by approximately $15 million. They also executed a stock repurchase program, buying back 335,000 shares for $5.3 million under a larger plan. This tells me they see the stock as undervalued and are committed to boosting shareholder value amidst the operational challenges.

Their longer-term plan is to focus on new Ultramax vessels, which are more fuel-efficient and better positioned to handle the new environmental mandates. You can see their strategic intent further detailed in their Mission Statement, Vision, & Core Values of EuroDry Ltd. (EDRY).

Next step for your due diligence: Model the impact of a 15% drop in the average TCE rate on their Q4 2025 cash flow, assuming current operating expenses hold steady.

Growth Opportunities

You are looking at EuroDry Ltd. (EDRY) and seeing a dry bulk shipper that, despite reporting a net loss for the third quarter of 2025, is defintely positioning itself for a stronger 2026 by strategically upgrading its fleet and capitalizing on a tightening market. The direct takeaway is that while the full-year 2025 earnings look weak, the company's pivot to eco-friendly vessels and its recent liquidity moves map a clearer path to profitability in the near-term.

The core growth driver for EuroDry Ltd. is a focused fleet renewal program, which is less about sheer expansion and more about efficiency and market premium. The company is actively replacing older, less efficient Panamax carriers through sales-like the M/V Eirini P. for approximately $8.5 million in October 2025-and investing the capital into new, eco-friendly tonnage. This is classic asset play: selling high-maintenance assets to fund vessels that command better charter rates.

This initiative is already concrete, with the company having contracted for two 63,500 deadweight tonnage (DWT) Ultramax bulk carriers, built to the latest EEDI Phase 3 design standard, for a total consideration of approximately $71.8 million. This move is a long-term play, with deliveries scheduled for 2027, but it sets the stage for a lower-cost, higher-revenue fleet. You can review the foundational principles driving this strategy at Mission Statement, Vision, & Core Values of EuroDry Ltd. (EDRY).

For the current fiscal year, the consensus estimates reflect the market challenges faced earlier in the year, projecting a full-year 2025 revenue of about $49.42 million and a consensus earnings per share (EPS) loss of ($2.80). However, the market is showing a strong recovery in the back half of 2025, which should be evident in the fourth quarter. Ultramax spot earnings approached $15,000 per day in the third quarter and even surpassed $17,000 per day since October, which is a significant tailwind.

Here's the quick math: if you can lock in one-year time charter rates for Ultramax vessels between $15,000 and $16,000 per day, which was the range in Q3 2025, you are well above the cash flow break-even level and generating positive cash flow.

The company's competitive advantages are rooted in operational efficiency and a strong management team. They maintain high fleet utilization rates-achieving 100% commercial utilization in late 2024-and benefit from cost-efficient operations through their affiliated managers, Eurobulk and Eurobulk FE. This operational prowess is a non-negotiable advantage in the cyclical, capital-intensive dry bulk sector.

Key strategic initiatives are also bolstering their financial foundation:

• Liquidity Boost: EuroDry raised approximately $15 million in liquidity by the end of 2025 through vessel sales and refinancing arrangements, which provides capital for the newbuild program and general operations.
• Financial Partner Expansion: Welcoming Credia Bank as a new financing partner positions the company well for continued, debt-supported fleet growth into 2026.
• Shareholder Return: The ongoing share repurchase plan has seen the company buy back 334,000 shares for $5.3 million, signaling management's belief that the stock is undervalued relative to its estimated Net Asset Value (NAV).

The overall market backdrop is also favorable, with dry-bulk fundamentals strengthening due to improving Chinese import activity and a historically low orderbook for new vessels, which limits supply growth into 2026. That supply/demand tightness is the real opportunity.