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Expeditors (EXPD) Strong on Dividends & Segmental Revenues

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We recently issued an updated report on Expeditors International of Washington (EXPD - Free Report) . The company is being aided by impressive performances across its key segments — Airfreight Services, Ocean Freight and Ocean Services and Customs Brokerage and Other Services. Its shareholder-friendly approach also bodes well.

Last month, this Seattle, WA-based third-party logistics provider reported better-than-expected earnings and revenues in the fourth quarter of 2018. Both the metrics also improved on a year-over-year basis. Robust freight pricing aided segmental results.

Notably, the airfreight forwarding market offers significant commercial potential. It is expected to witness a CAGR of approximately 4% during the 2018-2022 time frame backed by rapid e-commerce growth. This bodes well for Expeditors.

We are also impressed by Expeditors' efforts to reward its shareholders through dividend payments and buybacks. In 2018, the company repurchased 9 million shares at an average price of $71.61 per share. In 2017, it bought back only 8.2 million shares.

Lower tax rate is an added positive. Effective tax rate in 2018 was 24.3%, well below the 2017 figure of 31.8%. Given the savings induced by the low tax rate, we expect the company to hike dividend in 2019 as well. Moreover, the Zacks Consensus Estimate for current-year earnings has moved 2.9% north over the past 60 days, reflecting the positivity surrounding the stock.

Additionally, a Momentum Score of B reflects the short-term attractiveness of this Zacks Rank #1 (Strong Buy) stock. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Investors interested in the Zacks Transportation Sector may consider Azul S.A. (AZUL - Free Report) , Frontline Ltd. (FRO - Free Report) and SkyWest (SKYW - Free Report) , each sporting a Zacks Rank of 1.

All the three stocks boast an impressive earnings surprise history. Azul outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average being 97.9%. Frontline exceeded the consensus mark in each of the trailing four quarters, with an average beat of 69%. SkyWest outshined the consensus mark in each of the trailing four quarters, with an average beat of 16.9%.

Zacks' Top 10 Stocks for 2019

In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?

From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.

This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.

See Stocks Today >>

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