Investors Heavily Search Star Bulk Carriers Corp. (SBLK): Here is What You Need to Know

Star Bulk Carriers (SBLK) is one of the stocks most watched by Zacks.com visitors lately. So, it might be a good idea to review some of the factors that might affect the near-term performance of the stock.Over the past month, shares of this shipping company have returned +11.7%, compared to the Zacks S&P 500 composite's +5.4% change. During this period, the Zacks Transportation - Shipping industry, which Star Bulk Carriers falls in, has lost 1.5%. The key question now is: What could be the stock's future direction?Although media reports or rumors about a significant change in a company's business prospects usually cause its stock to trend and lead to an immediate price change, there are always certain fundamental factors that ultimately drive the buy-and-hold decision.Revisions to Earnings EstimatesRather than focusing on anything else, we at Zacks prioritize evaluating the change in a company's earnings projection. This is because we believe the fair value for its stock is determined by the present value of its future stream of earnings.Our analysis is essentially based on how sell-side analysts covering the stock are revising their earnings estimates to take the latest business trends into account. When earnings estimates for a company go up, the fair value for its stock goes up as well. And when a stock's fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements.Star Bulk Carriers is expected to post earnings of $0.03 per share for the current quarter, representing a year-over-year change of -96.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.The consensus earnings estimate of $1.32 for the current fiscal year indicates a year-over-year change of -49.8%. This estimate has remained unchanged over the last 30 days.For the next fiscal year, the consensus earnings estimate of $2.1 indicates a change of +58.7% from what Star Bulk Carriers is expected to report a year ago. Over the past month, the estimate has changed -1.4%.With an impressive externally audited track record, our proprietary stock rating tool -- the Zacks Rank -- is a more conclusive indicator of a stock's near-term price performance, as it effectively harnesses the power of earnings estimate revisions. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #5 (Strong Sell) for Star Bulk Carriers.The chart below shows the evolution of the company's forward 12-month consensus EPS estimate:12 Month EPSRevenue Growth ForecastEven though a company's earnings growth is arguably the best indicator of its financial health, nothing much happens if it cannot raise its revenues. It's almost impossible for a company to grow its earnings without growing its revenue for long periods. Therefore, knowing a company's potential revenue growth is crucial.In the case of Star Bulk Carriers, the consensus sales estimate of $243.45 million for the current quarter points to a year-over-year change of -31%. The $1.02 billion and $1.07 billion estimates for the current and next fiscal years indicate changes of -19.6% and +4.8%, respectively.Last Reported Results and Surprise HistoryStar Bulk Carriers reported revenues of $230.65 million in the last reported quarter, representing a year-over-year change of -11.1%. EPS of -$0.07 for the same period compares with $0.87 a year ago.Compared to the Zacks Consensus Estimate of $210.53 million, the reported revenues represent a surprise of +9.56%. The EPS surprise was +69.57%.Over the last four quarters, the company surpassed EPS estimates just once. The company topped consensus revenue estimates each time over this period.ValuationWithout considering a stock's valuation, no investment decision can be efficient. In predicting a stock's future price performance, it's crucial to determine whether its current price correctly reflects the intrinsic value of the underlying business and the company's growth prospects.While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price.As part of the Zacks Style Scores system, the Zacks Value Style Score (which evaluates both traditional and unconventional valuation metrics) organizes stocks into five groups ranging from A to F (A is better than B; B is better than C; and so on), making it helpful in identifying whether a stock is overvalued, rightly valued, or temporarily undervalued.Star Bulk Carriers is graded C on this front, indicating that it is trading at par with its peers. Click here to see the values of some of the valuation metrics that have driven this grade.Bottom LineThe facts discussed here and much other information on Zacks.com might help determine whether or not it's worthwhile paying attention to the market buzz about Star Bulk Carriers. However, its Zacks Rank #5 does suggest that it may underperform the broader market in the near term.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the favorite stock to gain +100% or more in the months ahead. They includeStock #1: A Disruptive Force with Notable Growth and ResilienceStock #2: Bullish Signs Signaling to Buy the DipStock #3: One of the Most Compelling Investments in the MarketStock #4: Leader In a Red-Hot Industry Poised for GrowthStock #5: Modern Omni-Channel Platform Coiled to SpringMost of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. While not all picks can be winners, previous recommendations have soared +171%, +209% and +232%.Download Atomic Opportunity: Nuclear Energy's Comeback free today.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Star Bulk Carriers Corp. (SBLK): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks