The fourth-quarter earnings picture for the transportation sector has been dismal so far. This is especially true as total earnings for the sector that have been reported so far are down
85.7% on 20.7% lower revenues. This is reflective of continued operating woes in the airline space, which has been hit hard by the COVID-19 pandemic. For a better understanding, let’s delve into the results of some well-known industry players: Transportation Earnings in Brief
The world's largest package delivery company
United Parcel Service ( topped the estimates on both revenues and earnings. Earnings of $2.66 per share were 55 cents ahead of the consensus mark and the top line of $24.9 billion was above the estimated $22.79 billion. UPS Quick Quote UPS - Free Report) Major railroads Union Pacific (and UNP Quick Quote UNP - Free Report) Norfolk Southern Corp ( also topped estimates. Union Pacific outpaced earnings estimates by 11 cents and revenues by $5 million, while Norfolk Southern surpassed on earnings by 16 cents and on revenues by $17 million. Meanwhile, NSC Quick Quote NSC - Free Report) Kansas City ( lagged the earnings estimate by a couple of cents and the revenue estimate by $7 million (see: KSU Quick Quote KSU - Free Report) all the Industrials ETFs here). U.S. airlines Delta Air Lines ( and DAL Quick Quote DAL - Free Report) United Continental ( delivered worse-than-expected results. Delta incurred a loss of $2.53 per share, wider than the Zacks Consensus Estimate of a loss of $2.43. Revenues of $3.97 billion topped the consensus mark of $3.75 billion. United posted a loss of $7 per share, wider than the Zacks Consensus Estimate of a loss of $6.56 and revenues of $3.41 billion were slightly below the estimated $3.42 billion. UAL Quick Quote UAL - Free Report) Last but not the least, leading trucking carrier J.B. Hunt (beat estimates for earnings by 17 cents per share and revenues by $208 million. JBHT Quick Quote JBHT - Free Report) ETFs in Focus
The Q4 earnings reports have led to rough trading in transport ETFs over the past 10 days. As such,
iShares Dow Jones Transportation Average Fund (, IYT Quick Quote IYT - Free Report) SPDR S&P Transportation ETF ( and XTN Quick Quote XTN - Free Report) First Trust Nasdaq Transportation ETF ( have shed 5.4%, 3.8% and 2%, respectively. However, all these products currently have a Zacks ETF Rank #2 (Buy), suggesting their outperformance in the months ahead (read: FTXR Quick Quote FTXR - Free Report) Sector ETFs to Gain the Most on COVID-19 Vaccine Rollout). IYT The fund tracks the Dow Jones Transportation Average Index, giving investors exposure to a small basket of 20 securities. The in-focus seven firms make up for a combined 44.5% share. From a sector perspective, railroads, and air freight & logistics take the largest share with 31.2% and 25.7% share, respectively, while trucking and airlines round off the next two spots with a double-digit exposure each. The fund has accumulated $1.7 billion in AUM and sees a solid trading volume of around 120,000 shares a day. It charges 42 bps in annual fees. XTN This fund tracks the S&P Transportation Select Industry Index, holding 42 stocks in its basket. The in-focus firms account for less than 2.8% share each. Further, 35.5% of the portfolio is dominated by trucking while airlines take around one-fourth share. With AUM of $492.5 million, the fund charges 35 bps in fees per year from investors and trades in a lower volume of around 102,000 shares a day. FTXR This fund offers exposure to the 31 most-liquid U.S. transportation securities based on volatility, value and growth by tracking the Nasdaq US Smart Transportation Index. The in-focus seven firms represent a combined 14.7% share. Ground freight & logistics takes the top spot at 33.4% while auto & truck manufacturers, auto, truck & motorcycle parts, and air freight & courier services round off the next spots with a double-digit exposure each. FTXR has amassed $1 billion in its asset base and charges 60 bps in annual fees. The average trading volume is a modest 151,000 shares (read: 2020 US Auto Sales Slip to 1970s Level: ETFs, Stocks in Focus). Want key ETF info delivered straight to your inbox?
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