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Celebrations may be in order for Eagle Bulk Shipping Inc. (NASDAQ:EGLE) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The consensus statutory numbers for both revenue and earnings per share (EPS) increased, with their view clearly much more bullish on the company's business prospects. The market may be pricing in some blue sky too, with the share price gaining 14% to US$33.52 in the last 7 days. Could this upgrade be enough to drive the stock even higher?
After the upgrade, the consensus from Eagle Bulk Shipping's four analysts is for revenues of US$254m in 2021, which would reflect a measurable 7.7% decline in sales compared to the last year of performance. Losses are expected to turn into profits real soon, with the analysts forecasting US$2.49 in per-share earnings. Before this latest update, the analysts had been forecasting revenues of US$224m and earnings per share (EPS) of US$0.58 in 2021. There has definitely been an improvement in perception recently, with the analysts substantially increasing both their earnings and revenue estimates.
See our latest analysis for Eagle Bulk Shipping
It will come as no surprise to learn that the analysts have increased their price target for Eagle Bulk Shipping 30% to US$35.34 on the back of these upgrades. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Eagle Bulk Shipping at US$30.00 per share, while the most bearish prices it at US$23.00. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Eagle Bulk Shipping is an easy business to forecast or the underlying assumptions are obvious.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that sales are expected to slow, with a forecast annualised revenue decline of 7.7% by the end of 2021. This indicates a significant reduction from annual growth of 20% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.1% annually for the foreseeable future. It's pretty clear that Eagle Bulk Shipping's revenues are expected to perform substantially worse than the wider industry.