Is JetBlue (JBLU) a value trap?
While JetBlue (JBLU) may appear cheap on a relative value basis, StarMine’s analyst revisions and price momentum timing indicators suggest that bargain hunters may be rewarded for staying patient in the short term.
The airlines stock is currently trading at 11.5x forward EPS, an apparent bargain compared to its trailing 12 month figure of 16.5x earnings and a 10-year median of 25x earnings.
However, StarMine’s analyst revisions and Predicted Surprise measures indicate that those earnings numbers are likely to come down.
The accompanying graphic shows a breakdown of StarMine’s Analyst Revisions Model (ARM), which assigns the stock a bottom-decile score of 9 out of 100. Pay close attention to the negative EPS predicted surprises across multiple years.
The stock also has a bottom decile StarMine Price Momentum Model score of 4 out of 100, indicating that market sentiment is also against the stock. As the old adage goes, don’t try to catch a falling knife.