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Transport Stocks' Q2 Earnings on Aug 9: TGH, DHT & ESEA
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All the transportation companies in the S&P 500 space have reported their quarterly numbers, as per our latest Earnings Trends report. With the sector participants facing a number of headwinds like the surge in terror attacks, declining coal shipments, uncertainty following the Brexit referendum and the spreading of the Zika virus to Florida, it is no surprise that this widely diversified sector (one of the 16 Zacks sectors) has posted negative earnings growth rate of 12.4% in Q2 compared to a positive 3.3% in Q1 for the S&P 500 transportation players. As per the report, the top line has shrunk 1.3% in Q2 whereas in Q1 revenue growth decelerated 0.9% on a year-over-year basis.
Despite the tepid year-over-year growth rates, the Q2 earnings season has seen a healthy proportion (66.7%) of companies in the space outshining the Zacks Consensus Estimate for earnings. This may be attributed to bottom-line out performances by key sector players like Norfolk Southern Corp. (NSC - Free Report) , Delta Air Lines (DAL - Free Report) and Expeditors International of Washington Inc. (EXPD - Free Report) . However, despite the earnings beats, the stock prices of the transportation players have remained subdued, reflecting the challenging times the sector is presently facing.
The bearish Zacks Industry ranks of the different sub-groups of the transport industry are also reflective of the headwinds confronting the space. For example, the Transportation-Airline, Transportation-Ship and the Transportation-Equipment & Leasing units carry a bearish Zacks Industry rank of 247, 206 and 237, respectively, among the 260+ industries. In fact, earnings growth is expected to be -3.5% for the entire S&P 500 index in Q2 with six of the 16 Zacks sectors projected to end the earnings season with negative growth.
Keeping the spotlight on the transportation sector, we highlight three stocks in the space which are gearing up to release their second-quarter numbers on Aug 9.
Textainer Group Holdings Limited , based in Bermuda, focuses on the purchase, ownership, management, leasing and disposal of a fleet of intermodal containers across the globe. According to our quantitative model, a company needs the right combination of two key ingredients – a positive Earnings ESP and a Zacks Rank #3 (Hold) or better – to increase the odds of an earnings surprise. The company’s Earnings ESP is +7.14% as the Most Accurate estimate is pegged at 15 cents while the Zacks Consensus Estimate is 1 cent lower. However, the company’s Zacks Rank #5 (Strong Sell) dims the hopes of an earnings beat. Please note that we caution against Sell-rated stocks going into the earnings announcement.
DHT Holdings (DHT - Free Report) , based in Bermuda, operates a fleet of double-hull crude oil tankers on international routes. DHT Holdings has an Earnings ESP of -3.57% as the Most Accurate estimate is pegged at 27 cents while the Zacks Consensus Estimate is 1 cent higher. The company has a Zacks Rank #4 (Sell).
Euroseas Ltd. (ESEA - Free Report) , based in Greece, operates in the dry cargo, drybulk and container shipping markets. The company, expected to report on Aug 9, carries a Zacks Rank #3. However, its Earnings ESP of 0.00% (the Most Accurate estimate is in line with the Zacks Consensus Estimate) is a spoiler which makes an earnings beat unlikely.
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Transport Stocks' Q2 Earnings on Aug 9: TGH, DHT & ESEA
All the transportation companies in the S&P 500 space have reported their quarterly numbers, as per our latest Earnings Trends report. With the sector participants facing a number of headwinds like the surge in terror attacks, declining coal shipments, uncertainty following the Brexit referendum and the spreading of the Zika virus to Florida, it is no surprise that this widely diversified sector (one of the 16 Zacks sectors) has posted negative earnings growth rate of 12.4% in Q2 compared to a positive 3.3% in Q1 for the S&P 500 transportation players. As per the report, the top line has shrunk 1.3% in Q2 whereas in Q1 revenue growth decelerated 0.9% on a year-over-year basis.
Despite the tepid year-over-year growth rates, the Q2 earnings season has seen a healthy proportion (66.7%) of companies in the space outshining the Zacks Consensus Estimate for earnings. This may be attributed to bottom-line out performances by key sector players like Norfolk Southern Corp. (NSC - Free Report) , Delta Air Lines (DAL - Free Report) and Expeditors International of Washington Inc. (EXPD - Free Report) . However, despite the earnings beats, the stock prices of the transportation players have remained subdued, reflecting the challenging times the sector is presently facing.
The bearish Zacks Industry ranks of the different sub-groups of the transport industry are also reflective of the headwinds confronting the space. For example, the Transportation-Airline, Transportation-Ship and the Transportation-Equipment & Leasing units carry a bearish Zacks Industry rank of 247, 206 and 237, respectively, among the 260+ industries. In fact, earnings growth is expected to be -3.5% for the entire S&P 500 index in Q2 with six of the 16 Zacks sectors projected to end the earnings season with negative growth.
Keeping the spotlight on the transportation sector, we highlight three stocks in the space which are gearing up to release their second-quarter numbers on Aug 9.
Textainer Group Holdings Limited , based in Bermuda, focuses on the purchase, ownership, management, leasing and disposal of a fleet of intermodal containers across the globe. According to our quantitative model, a company needs the right combination of two key ingredients – a positive Earnings ESP and a Zacks Rank #3 (Hold) or better – to increase the odds of an earnings surprise. The company’s Earnings ESP is +7.14% as the Most Accurate estimate is pegged at 15 cents while the Zacks Consensus Estimate is 1 cent lower. However, the company’s Zacks Rank #5 (Strong Sell) dims the hopes of an earnings beat. Please note that we caution against Sell-rated stocks going into the earnings announcement.
TEXTAINER GROUP Price and EPS Surprise
TEXTAINER GROUP Price and EPS Surprise | TEXTAINER GROUP Quote
DHT Holdings (DHT - Free Report) , based in Bermuda, operates a fleet of double-hull crude oil tankers on international routes. DHT Holdings has an Earnings ESP of -3.57% as the Most Accurate estimate is pegged at 27 cents while the Zacks Consensus Estimate is 1 cent higher. The company has a Zacks Rank #4 (Sell).
DHT HOLDINGS Price and EPS Surprise
DHT HOLDINGS Price and EPS Surprise | DHT HOLDINGS Quote
Euroseas Ltd. (ESEA - Free Report) , based in Greece, operates in the dry cargo, drybulk and container shipping markets. The company, expected to report on Aug 9, carries a Zacks Rank #3. However, its Earnings ESP of 0.00% (the Most Accurate estimate is in line with the Zacks Consensus Estimate) is a spoiler which makes an earnings beat unlikely.
EUROSEAS LTD Price and EPS Surprise
EUROSEAS LTD Price and EPS Surprise | EUROSEAS LTD Quote
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