Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Werner (NASDAQ: WERN) and its peers.
The growth of e-commerce and global trade continues to drive demand for shipping services, especially last-mile delivery, presenting opportunities for ground transportation companies. The industry continues to invest in data, analytics, and autonomous fleets to optimize efficiency and find the most cost-effective routes. Despite the essential services this industry provides, ground transportation companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.
The 16 ground transportation stocks we track reported a satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 6.6% since the latest earnings results.
Best Q2: Werner (NASDAQ: WERN)
Conducting business in over a 100 countries, Werner (NASDAQ: WERN) offers full-truckload, less-than-truckload, and intermodal delivery services.
Werner reported revenues of $753.1 million, down 1% year on year. This print exceeded analysts’ expectations by 3%. Overall, it was a stunning quarter for the company with a beat of analysts’ EPS and adjusted operating income estimates.
Unsurprisingly, the stock is down 6.6% since reporting and currently trades at $25.98.
Is now the time to buy Werner? Access our full analysis of the earnings results here, it’s free.
RXO (NYSE: RXO)
With access to millions of trucks, RXO (NYSE: RXO) offers full-truckload, less-than-truckload, and last-mile deliveries.
RXO reported revenues of $1.42 billion, up 52.6% year on year, falling short of analysts’ expectations by 1%. However, the business still had an exceptional quarter with a solid beat of analysts’ sales volume and EPS estimates.
RXO achieved the fastest revenue growth among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $15.30.
Is now the time to buy RXO? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: Heartland Express (NASDAQ: HTLD)
Founded by the son of a trucker, Heartland Express (NASDAQ: HTLD) offers full-truckload deliveries across the United States and Mexico.
Heartland Express reported revenues of $210.4 million, down 23.4% year on year, falling short of analysts’ expectations by 10.4%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates and a significant miss of analysts’ EBITDA estimates.
Heartland Express delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 3.9% since the results and currently trades at $8.33.
Read our full analysis of Heartland Express’s results here.
Hertz (NASDAQ: HTZ)
Started with a dozen Model T Fords, Hertz (NASDAQ: HTZ) is a global car rental company providing vehicle rental services to leisure and business travelers.
Hertz reported revenues of $2.19 billion, down 7.1% year on year. This number topped analysts’ expectations by 1.3%. It was a very strong quarter as it also put up an impressive beat of analysts’ sales volume and EBITDA estimates.
The stock is up 23.1% since reporting and currently trades at $6.87.
Read our full, actionable report on Hertz here, it’s free.
Knight-Swift Transportation (NYSE: KNX)
Covering 1.6 billion loaded miles in 2023 alone, Knight-Swift Transportation (NYSE: KNX) offers less-than-truckload and full truckload delivery services.
Knight-Swift Transportation reported revenues of $1.86 billion, flat year on year. This print was in line with analysts’ expectations. Overall, it was a strong quarter as it also recorded an impressive beat of analysts’ sales volume estimates and a solid beat of analysts’ adjusted operating income estimates.
The stock is down 14.6% since reporting and currently trades at $39.
Read our full, actionable report on Knight-Swift Transportation here, it’s free.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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