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Ryder System’s (R - Free Report) third-quarter 2021 earnings (excluding 2 cents from non-recurring items) of $2.55 per share surpassed the Zacks Consensus Estimate of $2.12. The bottom line increased in excess of 100% year over year on the back of higher revenues.
Total revenues of $2,459 million also outperformed the Zacks Consensus Estimate of $2,362.9 million. The top line increased 14.3% year over year on strong segmental performances.
Ryder System, Inc. Price, Consensus and EPS Surprise
Fleet Management Solutions: Total revenues of $1,436 million were up 11% year over year. Operating revenues (excluding fuel and lease liability insurance revenues) summed $1,248 million, up 8% year over year. Segmental revenues benefited from higher rental revenues on the back of strong demand and favorable pricing. Revenues increased on higher fuel pricing as well. Within the segment, commercial rental revenues increased 37% year over year while fuel services revenues jumped 37%. ChoiceLease revenues inched up 1% while SelectCare revenues dipped 1%.
Dedicated Transportation Solutions: Total revenues amounted to $380 million, up 27% from the year-ago quarter’s figure. Operating revenues (excluding fuel and subcontracted transportation) climbed 16% to $272 million. The revenue uptick was driven by new business, favorable pricing and higher volumes.
Supply-Chain Solutions: Total revenues in the segment were $802 million, up 17% year over year. Operating revenues (excluding fuel and subcontracted transportation) rose 14% year over year to $559 million on the back of revenue growth in most industry verticals.
Other Details
Ryder, currently carrying a Zacks Rank #2 (Buy), exited the third quarter with cash and cash equivalents of $202.7 million compared with $151.3 million at the end of 2020. The company’s total debt (including current portion) fell to $5,987.1 million at the end of the third quarter from $6,610.2 million at the end of 2020.
During the first nine months of 2021, gross capital expenditures increased to $1,495.9 million from $765 million in the year-ago period due to higher investments on rental fleet. Free cash flow in the first nine months of 2021 was $829 million, down from $1,217.9 million in the first nine months of 2020.
Driven by favorable demand and pricing in used vehicle sales and rental in addition to higher lease returns, the company raised its current-year earnings per share guidance. It now estimates adjusted earnings per share in the range of $8.40-$8.50 compared with the previously guided range of $7.20-$7.50. The Zacks Consensus Estimate for the current-year earnings currently stands at $7.58.
Free cash flow is predicted between $1 billion and $1.1 billion in 2021 compared with $650-$750 million, expected previously. Cash flow from operating activities is still expected to be $2.2 billion for the current year. Return on equity is projected in the 18-19% range.
Capital expenditures are predicted in the range of $1.9-$2 billion (previous guidance: $2.2-$2.3 billion) for the current year. The reduction is due to vehicle delivery delays.
For the fourth quarter, Ryder anticipates adjusted earnings per share in the band of $2.36-$2.46. The Zacks Consensus Estimate for the same is currently pegged at $2.00.
Sectorial Snapshots
Let’s take a look at some of the other earnings releases from companies within the Zacks Transportation sector.
CSX Corporation (CSX - Free Report) reported third-quarter 2021 earnings of 43 cents per share, surpassing the Zacks Consensus Estimate of 38 cents. Total revenues of $3,292 million outperformed the Zacks Consensus Estimate of $3030.9 million.
Southwest Airlines (LUV - Free Report) incurred a loss (excluding 96 cents from non-recurring items) of 23 cents per share in the third quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of 27 cents. Operating revenues of $4,679 million outperformed the Zacks Consensus Estimate of $4,581.5 million.
United Airlines (UAL - Free Report) incurred a loss (excluding $2.46 from non-recurring items) of $1.02 per share in the third quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $1.65. Operating revenues of $7,750 million surpassed the Zacks Consensus Estimate of $7639.7 million.
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Ryder (R) Beats on Q3 Earnings & Revenues, Lifts 2021 EPS View
Ryder System’s (R - Free Report) third-quarter 2021 earnings (excluding 2 cents from non-recurring items) of $2.55 per share surpassed the Zacks Consensus Estimate of $2.12. The bottom line increased in excess of 100% year over year on the back of higher revenues.
Total revenues of $2,459 million also outperformed the Zacks Consensus Estimate of $2,362.9 million. The top line increased 14.3% year over year on strong segmental performances.
Ryder System, Inc. Price, Consensus and EPS Surprise
Ryder System, Inc. price-consensus-eps-surprise-chart | Ryder System, Inc. Quote
Segmental Results
Fleet Management Solutions: Total revenues of $1,436 million were up 11% year over year. Operating revenues (excluding fuel and lease liability insurance revenues) summed $1,248 million, up 8% year over year. Segmental revenues benefited from higher rental revenues on the back of strong demand and favorable pricing. Revenues increased on higher fuel pricing as well. Within the segment, commercial rental revenues increased 37% year over year while fuel services revenues jumped 37%. ChoiceLease revenues inched up 1% while SelectCare revenues dipped 1%.
Dedicated Transportation Solutions: Total revenues amounted to $380 million, up 27% from the year-ago quarter’s figure. Operating revenues (excluding fuel and subcontracted transportation) climbed 16% to $272 million. The revenue uptick was driven by new business, favorable pricing and higher volumes.
Supply-Chain Solutions: Total revenues in the segment were $802 million, up 17% year over year. Operating revenues (excluding fuel and subcontracted transportation) rose 14% year over year to $559 million on the back of revenue growth in most industry verticals.
Other Details
Ryder, currently carrying a Zacks Rank #2 (Buy), exited the third quarter with cash and cash equivalents of $202.7 million compared with $151.3 million at the end of 2020. The company’s total debt (including current portion) fell to $5,987.1 million at the end of the third quarter from $6,610.2 million at the end of 2020.
During the first nine months of 2021, gross capital expenditures increased to $1,495.9 million from $765 million in the year-ago period due to higher investments on rental fleet. Free cash flow in the first nine months of 2021 was $829 million, down from $1,217.9 million in the first nine months of 2020.
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Outlook
Driven by favorable demand and pricing in used vehicle sales and rental in addition to higher lease returns, the company raised its current-year earnings per share guidance. It now estimates adjusted earnings per share in the range of $8.40-$8.50 compared with the previously guided range of $7.20-$7.50. The Zacks Consensus Estimate for the current-year earnings currently stands at $7.58.
Free cash flow is predicted between $1 billion and $1.1 billion in 2021 compared with $650-$750 million, expected previously. Cash flow from operating activities is still expected to be $2.2 billion for the current year. Return on equity is projected in the 18-19% range.
Capital expenditures are predicted in the range of $1.9-$2 billion (previous guidance: $2.2-$2.3 billion) for the current year. The reduction is due to vehicle delivery delays.
For the fourth quarter, Ryder anticipates adjusted earnings per share in the band of $2.36-$2.46. The Zacks Consensus Estimate for the same is currently pegged at $2.00.
Sectorial Snapshots
Let’s take a look at some of the other earnings releases from companies within the Zacks Transportation sector.
CSX Corporation (CSX - Free Report) reported third-quarter 2021 earnings of 43 cents per share, surpassing the Zacks Consensus Estimate of 38 cents. Total revenues of $3,292 million outperformed the Zacks Consensus Estimate of $3030.9 million.
Southwest Airlines (LUV - Free Report) incurred a loss (excluding 96 cents from non-recurring items) of 23 cents per share in the third quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of 27 cents. Operating revenues of $4,679 million outperformed the Zacks Consensus Estimate of $4,581.5 million.
United Airlines (UAL - Free Report) incurred a loss (excluding $2.46 from non-recurring items) of $1.02 per share in the third quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $1.65. Operating revenues of $7,750 million surpassed the Zacks Consensus Estimate of $7639.7 million.