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Golden Ocean Group (GOGL) Hits 52-Week High, Can the Run Continue?
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Have you been paying attention to shares of Golden Ocean Group (GOGL - Free Report) ? Shares have been on the move with the stock up 6.7% over the past month. The stock hit a new 52-week high of $9.95 in the previous session. Golden Ocean Group has gained 21.1% since the start of the year compared to the 3.6% move for the Zacks Transportation sector and the 2.5% return for the Zacks Transportation - Shipping industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 17, 2018, Golden Ocean Group reported EPS of $0.07 versus consensus estimate of $0.03 while it beat the consensus revenue estimate by 42.51%.
For the current fiscal year, Golden Ocean Group is expected to post earnings of $0.49 per share on $470.53 million in revenues. This represents a 2550% change in EPS on a 1.83% change in revenues. For the next fiscal year, the company is expected to earn $0.68 per share on $477.77 million in revenues. This represents a year-over-year change of 39.46% and 1.54%, respectively.
Valuation Metrics
Golden Ocean Group may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Golden Ocean Group has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20.1X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 14.4X versus its peer group's average of 5.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Golden Ocean Group currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Golden Ocean Group passes the test. Thus, it seems as though Golden Ocean Group shares could have a bit more room to run in the near term.
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Golden Ocean Group (GOGL) Hits 52-Week High, Can the Run Continue?
Have you been paying attention to shares of Golden Ocean Group (GOGL - Free Report) ? Shares have been on the move with the stock up 6.7% over the past month. The stock hit a new 52-week high of $9.95 in the previous session. Golden Ocean Group has gained 21.1% since the start of the year compared to the 3.6% move for the Zacks Transportation sector and the 2.5% return for the Zacks Transportation - Shipping industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on August 17, 2018, Golden Ocean Group reported EPS of $0.07 versus consensus estimate of $0.03 while it beat the consensus revenue estimate by 42.51%.
For the current fiscal year, Golden Ocean Group is expected to post earnings of $0.49 per share on $470.53 million in revenues. This represents a 2550% change in EPS on a 1.83% change in revenues. For the next fiscal year, the company is expected to earn $0.68 per share on $477.77 million in revenues. This represents a year-over-year change of 39.46% and 1.54%, respectively.
Valuation Metrics
Golden Ocean Group may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Golden Ocean Group has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20.1X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 14.4X versus its peer group's average of 5.3X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Golden Ocean Group currently has a Zacks Rank of #2 (Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Golden Ocean Group passes the test. Thus, it seems as though Golden Ocean Group shares could have a bit more room to run in the near term.