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Expeditors (EXPD) Shares Up 62.3% in Past Year: Here's Why

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Expeditors International of Washington, Inc.‘s (EXPD - Free Report) shares have surged 62.3% in the past year compared with the industry’s 53.4% increase.

Reasons for Surge

Expeditors is gaining from uptick in airfreight revenues. Notably, revenues from its airfreight services segment increased 63.3% year over year in 2020. The metric surged more than 100% year over year to $1,476.96 million in the first quarter of 2021. The coronavirus-induced cancellation of multiple passenger flights (that usually carry freight as well as passenger luggage) increased the usage of charters. Due to the coronavirus-induced imbalance between scheduled capacity and demand, the company is using charters to meet customers’ needs.

We are also optimistic about the company’s efforts to reward its shareholders, despite the coronavirus-scarred scenario. In 2020, the company repurchased 4.6 million shares on average price of $72.26 per share. During the first quarter of 2021, the company repurchased 0.9 million of common stock at an average price of $92.98 per share. Moreover, in May 2021, the company announced an 11.5% hike in semi-annual cash dividend to 58 cents per share (annualized $1.16 per share).

Moreover, the buyout of Fleet Logistics’ Digital Platform bodes well. The acquisition has boosted Expeditors’ online LTL shipping platform, Koho. The move is in line with the company's focus on Digital Solutions.

Favorable Estimate Revisions

Driven by surge in airfreight revenues, the Zacks Consensus Estimate for current-year bottom line has increased 15% to $4.83 per share in the past 60 days.

Zacks Rank & Other Stocks to Consider

Expeditors currently sports a Zacks Rank #1 (Strong Buy).

Investors interested in the broader Zacks Transportation sector can also look for Landstar System, Inc. (LSTR - Free Report) , Triton International Limited and Herc Holdings Inc. (HRI - Free Report) . Herc Holdings sports a Zacks Rank #1, while Triton and Landstar carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term (three to five years) expected earnings per share growth rate for Landstar, Triton and Herc Holdings is projected at 12%, 10% and 42.9%, respectively.

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