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Why Is Ryder System (R) Down 11.3% Since its Last Earnings Report?
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A month has gone by since the last earnings report for Ryder System, Inc. (R - Free Report) . Shares have lost about 11.3% in that time frame.
Will the recent negative trend continue leading up to its next earnings release, or is R due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Fourth-quarter earnings
Ryder System reported fourth-quarter 2017 earnings per share (excluding $10.74 from non-recurring items) of $1.37 per share, surpassing the Zacks Consensus Estimate of $1.35. Earnings increased 28% on a year-over-year basis.
Ryder recorded total revenues of $1,940 million, which surpassed the Zacks Consensus Estimate of $1,834.9 million. Moreover, revenues increased 12% year over year. All major segments of the company performed well in the quarter. Net capital expenditures (including proceeds from the sale of assets) increased 12.7% to $1.51 billion in 2017.
Segment Results
Fleet Management Solutions: Total revenue was $1.24 billion, up 8% year over year. Operating revenues (revenues excluding fuel) came in at $1.06 billion, up 7% year over year. Segmental results were aided by an increase in lease revenues on the back of a larger average fleet size.
Dedicated Transportation Solutions: Total revenue came in at $284 million, up 11% from the year-ago quarter. Operating revenues (excluding fuel and subcontracted transportation) inched up 3% year over year to $198 million.
Supply Chain Solutions: Total revenue in the quarter under review was $540 million, up 26% year over year. Operating revenues (revenues excluding fuel and subcontracted transportation) increased 16% year over year to $411 million.
Liquidity
Ryder System exited the fourth quarter with cash and cash equivalents of $78.3 million compared with $58.8 million at the end of 2016. The company had total debt of $5,409.7 million compared with $5,391.3 million at the end of 2016.
Guidance
The company expects 2018 adjusted earnings in the band of $5.40 to $5.70 per share, higher than 2017 levels. Operating revenues are projected to increase 8% in 2018. The company expects first quarter 2018 adjusted earnings per share between 83 cents to 90 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. There have been two revisions lower for the current quarter. In the past month, the consensus estimate has shifted downward by 12.2% due to these changes.
Currently, R has a nice Growth Score of B, though it is lagging a lot on the momentum front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for value investors than growth investors.
Outlook
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift. Notably, R has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Ryder System (R) Down 11.3% Since its Last Earnings Report?
A month has gone by since the last earnings report for Ryder System, Inc. (R - Free Report) . Shares have lost about 11.3% in that time frame.
Will the recent negative trend continue leading up to its next earnings release, or is R due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Fourth-quarter earnings
Ryder System reported fourth-quarter 2017 earnings per share (excluding $10.74 from non-recurring items) of $1.37 per share, surpassing the Zacks Consensus Estimate of $1.35. Earnings increased 28% on a year-over-year basis.
Ryder recorded total revenues of $1,940 million, which surpassed the Zacks Consensus Estimate of $1,834.9 million. Moreover, revenues increased 12% year over year. All major segments of the company performed well in the quarter. Net capital expenditures (including proceeds from the sale of assets) increased 12.7% to $1.51 billion in 2017.
Segment Results
Fleet Management Solutions: Total revenue was $1.24 billion, up 8% year over year. Operating revenues (revenues excluding fuel) came in at $1.06 billion, up 7% year over year. Segmental results were aided by an increase in lease revenues on the back of a larger average fleet size.
Dedicated Transportation Solutions: Total revenue came in at $284 million, up 11% from the year-ago quarter. Operating revenues (excluding fuel and subcontracted transportation) inched up 3% year over year to $198 million.
Ryder System exited the fourth quarter with cash and cash equivalents of $78.3 million compared with $58.8 million at the end of 2016. The company had total debt of $5,409.7 million compared with $5,391.3 million at the end of 2016.
Guidance
The company expects 2018 adjusted earnings in the band of $5.40 to $5.70 per share, higher than 2017 levels. Operating revenues are projected to increase 8% in 2018. The company expects first quarter 2018 adjusted earnings per share between 83 cents to 90 cents.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates. There have been two revisions lower for the current quarter. In the past month, the consensus estimate has shifted downward by 12.2% due to these changes.
Ryder System, Inc. Price and Consensus
Ryder System, Inc. Price and Consensus | Ryder System, Inc. Quote
VGM Scores
Currently, R has a nice Growth Score of B, though it is lagging a lot on the momentum front with a D. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for value investors than growth investors.
Outlook
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift. Notably, R has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.