Ryder System, Inc. (R - Analyst Report) has opened a new maintenance and rental facility in Vermont dedicated to commercial vehicle fleets. The existing facility in the area caters to a variety of customers from different industries and services with short-term full service rental for commercial vehicles. We believe increased infrastructural support will not only attracts more customers and bode well for the long-term growth of the company.
Ryder System continues to benefit from organic growth across its business line. Strong market demand with tighter transportation markets, in particular for trucks, has enabled the company to realize higher pricing. The company expects improved offerings in contractual product lines in the FMS segment with a newer lease fleet and various maintenance initiatives to improve 2013 earnings. Organic growth in Full Service Lease along with improved volumes in new business and supply chain are expected to aid the company in generating high revenues in the coming months.
In addition, increase in used vehicle sales will continue, with better pricing aiding growth. Additionally, Ryder is targeting emerging markets for fuel-efficient vehicles under projects like SANBAG (San Bernardino Associated Governments). In the coming days, we expect the demand for such vehicles to rise, providing potential market opportunity for the company. In Mar 2013, the company entered its first-ever full-service lease agreement for providing 23 compressed natural gas tractors to La.-based Eagle Distributing of Shreveport, Inc.
Ryder currently holds a Zacks Rank #3 (Hold).
Other stocks worth investing in this sector include AMERCO (UHAL), American Railcar Industries, Inc. (ARII - Snapshot Report) and Trinity Industries Inc. (TRN - Snapshot Report). While AMERCO carries a Zacks Rank #1 (Strong Buy), the other two companies hold a Zacks Rank #2 (Buy).