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Strength Seen in Star Bulk Carriers (SBLK): Can Its 9.7% Jump Turn into More Strength?

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Star Bulk Carriers (SBLK) shares rallied 9.7% in the last trading session to close at $24.37. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 0.5% gain over the past four weeks.

The optimism surrounding the dry bulk shipping market is a positive for the stock, which has enjoyed a bullish run on the bourses, soaring 178% year to date. Continuing with this bright scenario, shares of this shipping company touched a six-year high on Jun 16. Factors like an improving demand environment for seaborne dry bulk commodities and upbeat supply-side dynamics helped it win a raised target price at Jefferies with a Buy rating.

This shipping company is expected to post quarterly earnings of $1.25 per share in its upcoming report, which represents a year-over-year change of +757.9%. Revenues are expected to be $331.15 million, up 126.6% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Star Bulk Carriers, the consensus EPS estimate for the quarter has been revised 13.8% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on SBLK going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank 1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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