well hello it's bob i'm back again with another video in today's video somebody just asked me
hey this one company has a 28 dividend yield is it a dividend trap or is it worth looking into well
today we're gonna do a deep dive on this company and if you have other suggestions for future stock
picks drop them down in the comments below we're going to talk today about sblk otherwise known as
starbuck carriers corporation let's talk about what that company is and then we're going to
look under the herd and see if this 28 dividend is worth getting excited about or running away
from starbuck what they are is a shipping company engaging in the ocean transportation of dry bulk
cargos worldwide now if we think about that for a second anything that happened when it came down to
transportation of goods and services especially in the last year with demand so high and the ability
to produce a lot of supply for all that demand well yeah the carrier corporations are gonna get
a lot of money thrown at them because people are kind of excited about the fact that hey
the faster you can get my stuff to land the more excited i'm gonna be so i could see this scene a
very successful year and a half or two years ahead but will it be sustained that's something we got
to keep our eye on and as of december 31st 2021 it has a total fleet of 128 vessels with an aggregate
capacity of approximately 14.1 million deadweight time this company is rather new incorporated in
2006 and based in greece so first thing i like to look at courtesy of seeking alpha is right
here the dividend summary look at that 28.21 yield annual payout of six dollars and sixty cents and
that means every quarter they pay a dividend their last dividend payout date was on june 16th for a
total of one dollar and sixty-five cents per share pretty darn sexy if you ask me but let's look
under the hood and in order to look under the hood we're going to go do some drawing as we always do
looking at our smart steps for analyzing a stock right here it is we're going to look at the payout
ratio p e eps revenue profit assets and ownership let's get right to it with the pay out ratio
now in order to look at these and really analyze these the right way we need to look at what is
actually happening on the financials of the particular company because again it's just like
a car you don't want to go to a car lot and buy this beautiful looking car that you think man this
thing just looks beautiful only to realize that when you open up the hood it has no engine inside
of the beautiful sexy car that's going to get you absolutely nowhere very quickly over on seeking
alpha you go to the dividends tab right over here and you can look at the dividend score card now
the first thing that catches my attention is the consistency at a d plus that is telling me that
they have not been consistent in their dividend but if you look back over time they've actually
adjusted their dividend quite frequently it almost appears as though when things are looking good for
this particular carrier corporation they're paying you money they're saying yeah everything's great
but as soon as things turn they're like yeah we're going to lower the dividend payout and we're not
going to be consistent we want to see consistency and the overall payout of the dividend whether
it's a quarterly monthly or yearly basis overall the payout ratio that we look at is at a 68.88
so what you would look at here where it says payout ratio is you don't want it to look
like it's over 100 if it's over 100 that means they're taking all of their earnings all of their
potential profit and paying you dividends now in the case of stocks which is what we're looking
at here we're not looking at things like reits and bdcs we're looking at a stock so 68 is okay
that's fine but if it's over 100 it's time to get worried so we'll go ahead and say that the payout
ratio gets a green light i'm just going to simply highlight it to make it easier on this video
isn't that nice let's look at the p e ratio that stands for the price to earnings ratio what you
need to look at here especially in the summary tab of seeking alpha if that's the website you decide
to use you want something that's relatively low i like to look for opportunities under 15 on the
p e ratio and look at that the forward p e ratio right there sitting at a 3.44 you know what that
means it's not hard to say that is definitely a green light because it is well below that 15
aggregate number that we look at for the p e ratio by the way what you're looking at now
is seeking alpha premium i've decided to upgrade because it gives me so much more data
if you're interested in seeking out for the premium version i'll include a link down in the
description below go check it out and get started today so you can follow along with me and do your
own research and your own analysis because again none of this on these videos are financial advice
just giving you the tools and the education so you can become a better investor yourself next
thing we want to look at is earnings per share versus what the analyst said they were going to do
and right here is where we look at it right down on the bottom halfway down on the summary sheet
you can see for the quarters the blue line represents the actual what the company did and the
black line represents the estimate and it looks pretty good let's actually go i'm going to click
here and go to annual just to see how this looks so as you can see 2018 looked pretty good they
beat their estimate blue line is above the black line right same thing in 2019 2020 looked okay
um they did beat it but obviously it dropped as a result of the pandemic that makes sense and then
completely researched in 2021 so you can see the actual is above the estimate now i will give this
a green light but i would say that it's getting close to a yellow light and i'll tell you why
it's a yellow light until i feel good about this right here because i want to see 2022 beat that
high estimate as you can see right here in 2022 they're estimating the most earnings per share
as it has been throughout this entire period this is the highest it's been are they going to be able
to meet or exceed that estimate and if not i'd be a little bit worried and i'd keep a closer eye on
that and that's why as a stock investor when you buy any type of share of stock remember that you
become part owner of that company in order to become part owner of that company you got to
keep your eye on your company by looking at the financials and the results whether it's seeking
alpha or any other thing like finance.yahoo.com it doesn't matter what it is find what works best for
you and stay consistent with keeping your eye on the game let's go to revenue what we want to see
on revenue is we want to see revenue continue to grow all you do at the top here go to financials
and after you click on the financials tab it's right here on the income statement we can see
all the way back to 2012 let's look at right now just right here well actually no i'm going to
look at the total revenues right here and these are in millions so you have 86 million in 2012
all the way up to right here look at that 1.5 billion dollars in december 20 in all of 2021 and
that's a big increase from 693 million in december 2020 821 651 we are seeing an upward trend despite
the pandemic and the issues of the shutdown this looks pretty good and their ttm is looking at 1.5
they're still holding strong guess what this is also getting a green light now here we are about
halfway through and we're seeing a bunch of green lights and that dividend looks pretty darn sweet
so if you're an income investor could this be an opportunity with a warning that of course none of
this is financial advice but even bigger warning than that is that you got to make sure that you
keep your eye on what happens with the overall climate of the economy related to shipments
because again they're delivering goods to people they have vessels they're out there in the ocean
doing stuff if things slow down as a result of recession what's it going to do on this particular
company big big warning on that so let's go to the profit margin so you can get to the profit
margin by clicking on the summary tab on a seeking alpha score all the way to the bottom to where it
says profitability again if you have the premium version or higher you'll get the grade scores but
you can see right here at a gross profit margin of 67.77 percent we want to see anything over 10
or more that is absolutely beautiful keep your eye on that for now we're giving it a green light on
profit margin as well this thing is acing the test this is very rare go look at some of the
other videos you're looking like disney snapchat things like that some of those other stocks you
know they got some issues but this one's looking very interesting assets versus liability what you
want to make sure is that all of the stuff that they own and deal with if they have to
liquidate do they still owe money do they have enough assets to cover their liabilities right
that's basically what we're looking for here by going over to the financials tab and then clicking
on the balance sheet what we're going to look at is total assets so right down here at the bottom
you can of course look at turtle current but i'm going to look at total assets for this example
right here you can see 3754 is their assets let's look at their liabilities aka their debt
one six seven four that's phenomenal if they liquidate and they sell everything off right they
satisfy all their debt all their liability 1.6 that means they're sitting with a beautiful 3.7
minus 1.6 they're still in the green everything is fine they're not overborrowing they're not in over
their head that means they get also a green light assets versus liability let's look at
ownership to wrap this one up and see if this ship is gonna bring us home with that sexy 20
dividend so down here at the bottom we go over here to total shares outstanding
and we want to see this continue to go down and here we go finally not that i was looking for a
villain but here's our villain right total shares outstanding is not looking good and here's why you
go from 32 to 43 to 63 to 64 to 93 all the way up to 102. they're adding shares what you want as an
investor is you want more ownership of the company so let's say for example you have one share
and i have a total of 10 shares outstanding as a company that means you own 10 of the company right
but then all of a sudden i decide to issue more shares i'm trying to raise capital so i'm going
to take my 10 shares outstanding as a company and double that to 20. well one divided by 20
right you still only have that one share instead of earning 10 of the company you now only own 5
you want your ownership to continue to grow so because they're issuing so many shares that
gets a red light to keep an eye on so here we have all these green lights and a final red light that
means this is an interesting one to keep your eye on i'm not telling you to buy hold or sell any of
these type of things but that dividend does look pretty darn good again just to recap that at 26
you're talking about an annual payout ratio of 6.60 or 1.65 potentially per quarter at least
that was what their last dividend was so that was their declaration date on may 24th so i would
expect to maybe see this sometime in august for their next dividend that comes forward what do you
want to see next let me know and check out this video next and we'll see you on the next video