Ryder System, Inc. (R - Analyst Report) has opened a new maintenance and rental facility in Anchorage, Alaska. The unit represents the company’s first such operating location in the area. The service outlet provides maintenance and rental services for commercial vehicles. We believe increased infrastructural support will not only attract more customers but it also 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 market opportunity for the company. In Mar 2013, the company entered into 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), Trinity Industries Inc. (TRN - Snapshot Report) and American Railcar Industries, Inc. (ARII - Snapshot Report). While AMERCO and Trinity sport a Zacks Rank #1 (Strong Buy), American Railcar holds a Zacks Rank #2 (Buy).