It has been about a month since the last earnings report for SunTrust Banks, Inc. STI). Shares have lost about 2.6% in that time frame, underperforming the market.

Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

SunTrust Beats on Q1 Earnings, Provisions & Costs Rise

SunTrust’s first-quarter 2017 adjusted earnings of $0.87 per share outpaced the Zacks Consensus Estimate of $0.84. Also, the figure was up 4% year over year.

Results reflected an improvement in net interest income and non-interest income. Further, modest loan and deposit growth acted as a tailwind. However, an increase in provision for credit losses and higher operating expenses were the downsides.

Net income available to common shareholders was $451 million, up 5% year over year.

Increase in Revenues Supported Results, Costs Rise

Total revenue for the quarter grew 7% from the prior-year quarter to $2.21 billion. Further, the reported figure was above the Zacks Consensus Estimate of $2.20 billion.

Net interest income (FTE basis) increased 6% year over year to $1.4 billion. The rise was attributable to growth in average earning assets and higher net interest margin (NIM).

NIM was up 5 basis points (bps) year over year to 3.09%, reflecting higher earning asset yields and favorable impact of continued positive mix shift in the loan portfolio.

Non-interest income was $847 million, up 8% from the prior-year quarter. The increase was largely driven by higher investment banking income, partially offset by lower mortgage-related revenues.

Non-interest expenses were up 11% from the year-ago quarter to $1.47 billion. The rise was primarily due to increase in most expense categories, other than equipment costs and marketing and customer development expenses.

Credit Quality: A Mixed Bag

Total non-performing assets were $858 million as of Mar 31, 2017, down 26% from prior-year quarter. The fall was mainly attributable to the continued resolution of problem energy credits. Non-performing loans fell 15 bps year over year to 0.55% of total loans held for investment.

However, provision for credit losses jumped 18% from the year-ago quarter to $119 million. Also, rate of net charge-offs increased 7 bps year over year to 0.32% of total average loans held for investment.

Strong Balance Sheet

As of Mar 31, 2017, SunTrust had total assets of $205.6 billion while shareholders’ equity summed $23.5 billion, representing 11% of total assets.

As of Mar 31, 2017, loans were up marginally on a sequential basis to $143.5 billion. Total consumer and commercial deposits grew nearly 2% from the prior quarter to $161.5 billion.

SunTrust’s estimated common equity Tier 1 ratio under Basel III (on a fully phased-in basis) was 9.54% as of Mar 31, 2017.

Share Repurchase

During the reported quarter, SunTrust bought back shares worth $414 million.

How Have Estimates Been Moving Since Then?

Following the release, investors have witnessed a downward trend in fresh estimates. There have been two revisions higher for the current quarter compared to six lower. While looking back an additional 30 days, we can see even more downward momentum. There have been three moves higher compared to seven lower two months ago.

SunTrust Banks, Inc. Price and Consensus

SunTrust Banks, Inc. Price and Consensus | SunTrust Banks, Inc. Quote

VGM Scores

At this time, SunTrust's stock has a poor Growth Score of 'F', however its Momentum is doing a lot better with a 'B'. Charting a somewhat similar path, the stock was allocated a grade of 'C' on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of 'D'. If you aren't focused on one strategy, this score is the one you should be interested in.

Our style scores indicate that the stock is more suitable for momentum investors than value investors.

Outlook

Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Interestingly, the stock has a Zacks Rank #3 (Hold). We are looking for an inline return from the stock in the next few months.

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