Stock Analysis
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- NasdaqGM:BLBD
Blue Bird (NASDAQ:BLBD shareholders incur further losses as stock declines 12% this week, taking five-year losses to 41%
Blue Bird Corporation (NASDAQ:BLBD) shareholders should be happy to see the share price up 27% in the last quarter. But that doesn't change the fact that the returns over the last five years have been less than pleasing. In fact, the share price is down 41%, which falls well short of the return you could get by buying an index fund.
With the stock having lost 12% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.
View our latest analysis for Blue Bird
Blue Bird isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last five years Blue Bird saw its revenue shrink by 8.1% per year. That's not what investors generally want to see. The stock hasn't done well for shareholders in the last five years, falling 7%, annualized. But it doesn't surprise given the falling revenue. Without profits, its hard to see how shareholders win if the revenue keeps falling.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It's probably worth noting that the CEO is paid less than the median at similar sized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. So it makes a lot of sense to check out what analysts think Blue Bird will earn in the future (free profit forecasts).
A Different Perspective
We regret to report that Blue Bird shareholders are down 15% for the year. Unfortunately, that's worse than the broader market decline of 9.3%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 7% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Blue Bird (of which 1 is a bit concerning!) you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
What are the risks and opportunities for Blue Bird?
Blue Bird Corporation designs, engineers, manufactures, and sells school buses and related parts in the United States, Canada, and internationally.
Rewards
Trading at 84.8% below our estimate of its fair value
Earnings are forecast to grow 97.1% per year
Risks
Debt is not well covered by operating cash flow
Negative shareholders equity
Volatile share price over the past 3 months
Further research on
Blue Bird
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
About NasdaqGM:BLBD
Blue Bird
Blue Bird Corporation designs, engineers, manufactures, and sells school buses and related parts in the United States, Canada, and internationally.
Reasonable growth potential and fair value.
