Ryder System, Inc. (R - Free Report) , has unveiled a new transportation and logistics solution dedicated to the energy sector, in particular oil and gas. The new solution includes services Dedicated Fleet, Transportation Management and fleet Leasing and Rental.We expect Ryder’s new solution to be well received in the present market scenario ofrising gasoline supplies.
Through Ryder’s new offering, the company aims to improve transportation of equipment to job sites, simplify supply chain, expedite shipments and ensure safety of transportation across oilfields and offshore locations. Further, customers are expected to save premium shipments cost as the shipment solution would provide 30% reduction in fleet equipment cost, 50% lower pickup and delivery delays, and 20% growth in load efficiency.
Ryder System continues to benefit from organic growth across its business line. Strong market demand with tighter transportation markets, particularly for trucks, has enabled the company to realize higher pricing. The company expects improved offerings in contractual product lines in the FMS segment with a newer lease fleet and various maintenance initiatives to improve 2013 earnings. Organic growth in Full Service Lease along with improved volumes in new business and supply chain are expected to aid the company in generating high revenues in the coming months.
In addition, increase in used vehicle sales will remain a continuing trend, with better pricing aiding growth. Additionally, Ryder is targeting emerging markets for fuel-efficient vehicles under projects like SANBAG (San Bernardino Associated Governments). In the coming days, we expect the demand for such vehicles to rise providing potential market opportunity for the company. In Mar 2013, the company entered its first-ever full-service lease agreement for providing 23 compressed natural gas tractors to Louisiana-based Eagle Distributing of Shreveport, Inc.
Ryder currently holds a Zacks Rank #3 (Hold).
Other stocks worth investing in this sector include Westinghouse Air Brake Technologies Corporation (WAB - Free Report) , American Railcar Industries, Inc. (ARII - Free Report) and Trinity Industries Inc. (TRN - Free Report) . All these three companies hold a Zacks Rank #2 (Buy).