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A Look at Transport ETFs Post Uninspiring Q4 Earnings
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The fourth-quarter earnings picture for the transportation sector has been unimpressive. This is especially true as earnings of 91.8% of the market capitalization of the sector are down 15.6% on a 0.7% revenue decline. The earnings and revenue beat ratios came in at 72.7% and 63.6%, respectively.
As such, transportation ETFs have seen mixed performances over the past month. iShares U.S. Transportation ETF (IYT - Free Report) and First Trust Nasdaq Transportation ETF (FTXR - Free Report) have risen 3.4% and 0.9%, respectively, while SPDR S&P Transportation ETF (XTN - Free Report) has lost 1.2%.
For a better understanding, let’s delve into the results of some well-known industry players.
Transportation Earnings in Brief
The world's largest package delivery company, United Parcel Service (UPS - Free Report) , surpassed the Zacks Consensus Estimate for earnings but lagged the same for revenues. Earnings of $2.47 per share were 3 cents ahead of the consensus mark but revenues of $24.91 billion came in below the estimated $25.30 billion. For 2024, UPS anticipates revenues in the range of $92-$94.5 billion (see: all the Industrials ETFs here).
Major railroad company Union Pacific (UNP - Free Report) reported better-than-expected results while Norfolk Southern Corp (NSC - Free Report) missed estimates on both fronts. Union Pacific topped the consensus estimate for earnings by 15 cents and the revenue estimate by $50 million. Norfolk lagged the earnings estimate by 7 cents and the revenue estimate by $36 million.
U.S. airlines Delta Air Lines (DAL - Free Report) and United Airlines (UAL - Free Report) reported better-than-expected results. Delta reported earnings per share of $1.28, which outpaced the Zacks Consensus Estimate of $1.17. Revenues of $14.22 billion also edged past the consensus mark of $14.01 billion. United Airlines reported earnings of $2.00 per share, which handily beat the Zacks Consensus Estimate of $1.61. Revenues of $13.63 billion came in above the estimated $13.55 billion.
Last but not least, leading trucking carrier J.B. Hunt (JBHT - Free Report) missed estimates for earnings by 27 cents per share but outpaced the same for revenues by $74 million.
iShares U.S. Transportation ETF tracks the S&P Transportation Select Industry FMC Capped Index, giving investors exposure to a small basket of 43 securities. The six in-focus firms make up a combined 42.2% share. From a sector perspective, rail transportation and air freight & logistics take the largest share at 27.5% and 20.3%, respectively, while passenger ground transportation, cargo ground transportation, and passenger airlines round off the next three spots with double-digit exposure each.
iShares U.S. Transportation ETF has accumulated $929.5 million in its asset base and charges 40 bps in annual fees. It has a Zacks ETF Rank #2 (Buy) with a High risk outlook.
SPDR S&P Transportation ETF tracks the S&P Transportation Select Industry Index, holding 43 stocks in its basket. The in-focus firms account for around 2% share each. About 33% of the portfolio is dominated by cargo ground transportation, while passenger airlines, air freight & logistics round off the next two with double-digit exposure each (read: 5 Top-Ranked ETFs to Buy Cheap in 2024).
With AUM of $183.9 million, SPDR S&P Transportation ETF charges 35 bps in fees per year from its investors and has a Zacks ETF Rank #2 with a High risk outlook.
First Trust Nasdaq Transportation ETF offers exposure to the 41 most-liquid U.S. transportation securities based on volatility, value and growth by tracking the Nasdaq US Smart Transportation Index. The in-focus six firms represent a combined 28.4% share. Automobiles, railroads, commercial vehicle-equipment leasing, airlines and delivery services are the top sectors, accounting for double-digit exposure each.
First Trust Nasdaq Transportation ETF has amassed $38.3 million in its asset base and charges 60 bps in annual fees. FTXR has a Zacks ETF Rank #2.
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A Look at Transport ETFs Post Uninspiring Q4 Earnings
The fourth-quarter earnings picture for the transportation sector has been unimpressive. This is especially true as earnings of 91.8% of the market capitalization of the sector are down 15.6% on a 0.7% revenue decline. The earnings and revenue beat ratios came in at 72.7% and 63.6%, respectively.
As such, transportation ETFs have seen mixed performances over the past month. iShares U.S. Transportation ETF (IYT - Free Report) and First Trust Nasdaq Transportation ETF (FTXR - Free Report) have risen 3.4% and 0.9%, respectively, while SPDR S&P Transportation ETF (XTN - Free Report) has lost 1.2%.
For a better understanding, let’s delve into the results of some well-known industry players.
Transportation Earnings in Brief
The world's largest package delivery company, United Parcel Service (UPS - Free Report) , surpassed the Zacks Consensus Estimate for earnings but lagged the same for revenues. Earnings of $2.47 per share were 3 cents ahead of the consensus mark but revenues of $24.91 billion came in below the estimated $25.30 billion. For 2024, UPS anticipates revenues in the range of $92-$94.5 billion (see: all the Industrials ETFs here).
Major railroad company Union Pacific (UNP - Free Report) reported better-than-expected results while Norfolk Southern Corp (NSC - Free Report) missed estimates on both fronts. Union Pacific topped the consensus estimate for earnings by 15 cents and the revenue estimate by $50 million. Norfolk lagged the earnings estimate by 7 cents and the revenue estimate by $36 million.
U.S. airlines Delta Air Lines (DAL - Free Report) and United Airlines (UAL - Free Report) reported better-than-expected results. Delta reported earnings per share of $1.28, which outpaced the Zacks Consensus Estimate of $1.17. Revenues of $14.22 billion also edged past the consensus mark of $14.01 billion. United Airlines reported earnings of $2.00 per share, which handily beat the Zacks Consensus Estimate of $1.61. Revenues of $13.63 billion came in above the estimated $13.55 billion.
Last but not least, leading trucking carrier J.B. Hunt (JBHT - Free Report) missed estimates for earnings by 27 cents per share but outpaced the same for revenues by $74 million.
ETFs in Focus
iShares U.S. Transportation ETF (IYT - Free Report)
iShares U.S. Transportation ETF tracks the S&P Transportation Select Industry FMC Capped Index, giving investors exposure to a small basket of 43 securities. The six in-focus firms make up a combined 42.2% share. From a sector perspective, rail transportation and air freight & logistics take the largest share at 27.5% and 20.3%, respectively, while passenger ground transportation, cargo ground transportation, and passenger airlines round off the next three spots with double-digit exposure each.
iShares U.S. Transportation ETF has accumulated $929.5 million in its asset base and charges 40 bps in annual fees. It has a Zacks ETF Rank #2 (Buy) with a High risk outlook.
SPDR S&P Transportation ETF (XTN - Free Report)
SPDR S&P Transportation ETF tracks the S&P Transportation Select Industry Index, holding 43 stocks in its basket. The in-focus firms account for around 2% share each. About 33% of the portfolio is dominated by cargo ground transportation, while passenger airlines, air freight & logistics round off the next two with double-digit exposure each (read: 5 Top-Ranked ETFs to Buy Cheap in 2024).
With AUM of $183.9 million, SPDR S&P Transportation ETF charges 35 bps in fees per year from its investors and has a Zacks ETF Rank #2 with a High risk outlook.
First Trust Nasdaq Transportation ETF (FTXR - Free Report)
First Trust Nasdaq Transportation ETF offers exposure to the 41 most-liquid U.S. transportation securities based on volatility, value and growth by tracking the Nasdaq US Smart Transportation Index. The in-focus six firms represent a combined 28.4% share. Automobiles, railroads, commercial vehicle-equipment leasing, airlines and delivery services are the top sectors, accounting for double-digit exposure each.
First Trust Nasdaq Transportation ETF has amassed $38.3 million in its asset base and charges 60 bps in annual fees. FTXR has a Zacks ETF Rank #2.