Kirby Corporation (KEX - Free Report) is benefiting from its segmental performance and its ability to generate cash.
Factors Favoring KEX
In the distribution and services segment, Kirby is seeing increased demand for products and services. In the third quarter of 2023, revenues in the segment improved 7% to $334.8 million. Overall, oil and gas represented 37% of segmental revenues. Oil and gas operating margins were in the low double digits. In the fourth quarter, segmental revenues are expected to be up in the low to mid-single digits sequentially. The operating margin is expected to be flat or slightly down from third-quarter levels.
Kirby’s cash flow-generating ability is strong. In 2022, Kirby generated $121.5 million of cash from operating activities. Net cash flow provided by operating activities is anticipated in the $475-$525 million band for 2023. Capital expenditures are expected to be between $330 million and $380 million. Current-year free cash flow generation is projected in the range of $100-$150 million.
Key Risks
Kirby’s liquidity position is a concern. As of Sep 30, 2023, Kirby had cash and cash equivalents of $42.1 million compared with $80.57 million at the end of December 2022. Total debt was $1,067.9 million at the third-quarter end compared with $1,079.62 million at the end of December 2022.
Zacks Rank
KEX currently carries Zacks Rank #3 (Hold).
Key Picks
Some better-ranked stocks for investors interested in the Zacks Transportation sector are Air Canada (ACDVF - Free Report) and SkyWest (SKYW - Free Report) .
Air Canada currently sports a Zacks Rank #1 (Strong Buy). An uptick in passenger traffic is aiding ACDVF. Recently, management announced plans to launch a new year-round route between Montreal and Madrid. You can see the complete list of today’s Zacks #1 Rank stocks here.
The service will commence in May of the following year as part of its expanded international summer 2024 flying schedule to cater to increased demand.
SkyWest currently carries a Zacks Rank #2 (Buy). SKYW's fleet-modernization efforts are commendable. Initiatives to reward its shareholders also bode well. The Zacks Consensus Estimate for current-quarter earnings has surged 83.3% in the past 60 days.
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This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners Up
Kirby Corporation (KEX - Free Report) is benefiting from its segmental performance and its ability to generate cash.
Factors Favoring KEX
In the distribution and services segment, Kirby is seeing increased demand for products and services. In the third quarter of 2023, revenues in the segment improved 7% to $334.8 million. Overall, oil and gas represented 37% of segmental revenues. Oil and gas operating margins were in the low double digits. In the fourth quarter, segmental revenues are expected to be up in the low to mid-single digits sequentially. The operating margin is expected to be flat or slightly down from third-quarter levels.
Kirby’s cash flow-generating ability is strong. In 2022, Kirby generated $121.5 million of cash from operating activities. Net cash flow provided by operating activities is anticipated in the $475-$525 million band for 2023. Capital expenditures are expected to be between $330 million and $380 million. Current-year free cash flow generation is projected in the range of $100-$150 million.
Key Risks
Kirby’s liquidity position is a concern. As of Sep 30, 2023, Kirby had cash and cash equivalents of $42.1 million compared with $80.57 million at the end of December 2022. Total debt was $1,067.9 million at the third-quarter end compared with $1,079.62 million at the end of December 2022.
Zacks Rank
KEX currently carries Zacks Rank #3 (Hold).
Key Picks
Some better-ranked stocks for investors interested in the Zacks Transportation sector are Air Canada (ACDVF - Free Report) and SkyWest (SKYW - Free Report) .
Air Canada currently sports a Zacks Rank #1 (Strong Buy). An uptick in passenger traffic is aiding ACDVF. Recently, management announced plans to launch a new year-round route between Montreal and Madrid. You can see the complete list of today’s Zacks #1 Rank stocks here.
The service will commence in May of the following year as part of its expanded international summer 2024 flying schedule to cater to increased demand.
SkyWest currently carries a Zacks Rank #2 (Buy). SKYW's fleet-modernization efforts are commendable. Initiatives to reward its shareholders also bode well. The Zacks Consensus Estimate for current-quarter earnings has surged 83.3% in the past 60 days.
Research Chief Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.
Free: See Our Top Stock And 4 Runners Up
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