We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Kirby (KEX) Rides on Segmental Growth Amid Rising Costs
Read MoreHide Full Article
Kirby Corporation (KEX - Free Report) is benefiting from increased demand at the distribution and services segment and favorable market conditions at the marine transportation unit. Notably, shares of Kirby have gained 23.7% over the past year, outperforming 18.2% growth of the industryit belongs to.
Image Source: Zacks Investment Research
The company recently reported third-quarter earnings of 65 cents per share, which outpaced the Zacks Consensus Estimate of 60 cents and improved more than 100% year over year. Total revenues of $745.8 million missed the Zacks Consensus Estimate of $748.4 million. However, the top line improved 25% year over year on the back of higher revenues in the marine transportation and distribution and services segments.
Kirby Corporation Price, Consensus and EPS Surprise
Strong segmental performances are boosting Kirby’s top line. The distribution and services segment is benefiting from increased demand for products and services. During the first nine months of 2022, distribution and services segment revenues increased 26% year over year to $860.4 million. Kirby expects favorable oil price and strong demand to boost the performance of the Distribution and Services segment in the remainder of 2022 as well.
Revenues in the marine transportation unit increased 22.4% year over year to $1.19 billion during the first nine months of 2022, despite operations being still disrupted by COVID-19. In inland marine, within the marine transportation unit, Kirby expects favorable market conditions such as high refinery and petrochemical plant utilization, increased volumes from new petrochemical plants and minimal new barge construction to lead to improved barge utilization. With this, the company expects continued improvement in the spot market, which contributes substantially to inland revenues. Inland revenues are estimated to increase 20-25% year over year in 2022.
On the flip side, increased costs due to labor constraints and inflationary pressure pose a threat to Kirby’s bottom line. Rising fuel prices might further dent the company’s bottom line. Supply chain constraints are an added concern for the company. Costs are likely to have been high in the December quarter as well. In fact, KEX's CEO expects the December quarter performance to be hurt by due to foggy weather and low waters as well.
Management expects capital expenditures for 2022 in the range of $170 million-$190 million. The mid-point of the guided range ($180 million) is much higher than the 2021 actual figure of $98 million. High capex may hurt the free cash flow generating ability of KEX.
Some better-ranked stocks from the broader Zacks Transportation sector are Air Transport Services Group (ATSG - Free Report) , Ryder Systems (R - Free Report) and Teekay Tankers Ltd. (TNK - Free Report) ),each currently carrying a Zacks Rank #2 (Buy).
ATSG has an expected earnings growth rate of 34.34% for the current year. ATSG delivered a trailing four-quarter earnings surprise of 17.78%, on average.
The Zacks Consensus Estimate for ATSG’s current-year earnings has improved 5.2% over the past 90 days. Shares of ATSG have gained 7.9% over the past year.
Ryder has an expected earnings growth rate of 67.12% for the current year. R delivered a trailing four-quarter earnings surprise of 30.13%, on average.
The Zacks Consensus Estimate for R’s current-year earnings has improved 6.9% over the past 90 days. Shares of R have gained 12.7% over the past year.
Teekay Tankers has an expected earnings growth rate of 214.91% for the current year. TNK delivered a trailing four-quarter earnings surprise of 42.23%, on average. Teekay Tankers has a long-term expected growth rate of 3%.
The Zacks Consensus Estimate for TNK’s current-year earnings has improved 95% over the past 90 days. Shares of TNK have soared 190% over the past year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Kirby (KEX) Rides on Segmental Growth Amid Rising Costs
Kirby Corporation (KEX - Free Report) is benefiting from increased demand at the distribution and services segment and favorable market conditions at the marine transportation unit. Notably, shares of Kirby have gained 23.7% over the past year, outperforming 18.2% growth of the industryit belongs to.
Image Source: Zacks Investment Research
The company recently reported third-quarter earnings of 65 cents per share, which outpaced the Zacks Consensus Estimate of 60 cents and improved more than 100% year over year. Total revenues of $745.8 million missed the Zacks Consensus Estimate of $748.4 million. However, the top line improved 25% year over year on the back of higher revenues in the marine transportation and distribution and services segments.
Kirby Corporation Price, Consensus and EPS Surprise
Kirby Corporation price-consensus-eps-surprise-chart | Kirby Corporation Quote
How is Kirby Placed?
Strong segmental performances are boosting Kirby’s top line. The distribution and services segment is benefiting from increased demand for products and services. During the first nine months of 2022, distribution and services segment revenues increased 26% year over year to $860.4 million. Kirby expects favorable oil price and strong demand to boost the performance of the Distribution and Services segment in the remainder of 2022 as well.
Revenues in the marine transportation unit increased 22.4% year over year to $1.19 billion during the first nine months of 2022, despite operations being still disrupted by COVID-19. In inland marine, within the marine transportation unit, Kirby expects favorable market conditions such as high refinery and petrochemical plant utilization, increased volumes from new petrochemical plants and minimal new barge construction to lead to improved barge utilization. With this, the company expects continued improvement in the spot market, which contributes substantially to inland revenues. Inland revenues are estimated to increase 20-25% year over year in 2022.
On the flip side, increased costs due to labor constraints and inflationary pressure pose a threat to Kirby’s bottom line. Rising fuel prices might further dent the company’s bottom line. Supply chain constraints are an added concern for the company. Costs are likely to have been high in the December quarter as well. In fact, KEX's CEO expects the December quarter performance to be hurt by due to foggy weather and low waters as well.
Management expects capital expenditures for 2022 in the range of $170 million-$190 million. The mid-point of the guided range ($180 million) is much higher than the 2021 actual figure of $98 million. High capex may hurt the free cash flow generating ability of KEX.
Zacks Rank and Stocks to Consider
Currently, Kirby carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks from the broader Zacks Transportation sector are Air Transport Services Group (ATSG - Free Report) , Ryder Systems (R - Free Report) and Teekay Tankers Ltd. (TNK - Free Report) ), each currently carrying a Zacks Rank #2 (Buy).
ATSG has an expected earnings growth rate of 34.34% for the current year. ATSG delivered a trailing four-quarter earnings surprise of 17.78%, on average.
The Zacks Consensus Estimate for ATSG’s current-year earnings has improved 5.2% over the past 90 days. Shares of ATSG have gained 7.9% over the past year.
Ryder has an expected earnings growth rate of 67.12% for the current year. R delivered a trailing four-quarter earnings surprise of 30.13%, on average.
The Zacks Consensus Estimate for R’s current-year earnings has improved 6.9% over the past 90 days. Shares of R have gained 12.7% over the past year.
Teekay Tankers has an expected earnings growth rate of 214.91% for the current year. TNK delivered a trailing four-quarter earnings surprise of 42.23%, on average. Teekay Tankers has a long-term expected growth rate of 3%.
The Zacks Consensus Estimate for TNK’s current-year earnings has improved 95% over the past 90 days. Shares of TNK have soared 190% over the past year.