A month has gone by since the last earnings report for Landstar System (LSTR Quick QuoteLSTR - Free Report) . Shares have lost about 8.1% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Landstar due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Earnings Beat at Landstar in Q1

Landstar System’s first-quarter 2022 earnings of $3.34 per share surpassed the Zacks Consensus Estimate of $3.10. The bottom line surged 66.2% year over year on higher revenues.

Revenues of $1,970.6 million also outperformed the Zacks Consensus Estimate of $1,850 million. The top line soared 53% year over year owing to strong performances of the truck transportation, rail intermodal, and ocean and air-cargo carrier segments.

The top and the bottom-line beat in the first quarter as well as a strong second-quarter 2022 guidance pleased investors. Earnings per share for the June quarter are estimated in the band of $3.22-$3.32. The Zacks Consensus Estimate for the same is currently pegged at $2.79 per share. As a result, the stock has gained 3.8% since the earnings announcement on Apr 20.

Gross profit came in at $214.6 million in the reported quarter, up 46% year over year. Operating income surged 57.6% from the prior-year quarter’s figure to $162.8 million. Total costs and expenses (on a reported basis) increased 42.6% to $1.8 billion.

Total revenues in the truck transportation segment — contributing to 88.9% of the top line — amounted to $1.75 billion, up 45.8% from the year-ago quarter’s figure. Within the truck transportation segment, revenues hauled via van equipment rose 48% to $1.08 billion. Truckload transportation revenues hauled via unsided/platform equipment climbed 37% to $408.8 million.

Less-than-truckload revenues increased 31% to $33.7 million. Overall, first-quarter truck transportation revenue per load rose 22.5% year over year.

Rail intermodal revenues of $42.7 million increased 34.7% from the figure recorded in first-quarter 2021.  Revenues in the ocean and air-cargo carrier segments skyrocketed in excess of 100% year over year to $152.1 million. Other revenues increased 67.3% to $24.6 million.

Liquidity

At the end of the first quarter of 2022, Landstar had cash and cash equivalents of $146 million compared with $215.5 million recorded at the end of 2021. Additionally, long-term debt (excluding current maturities) totaled $137.3 million at the end of the March quarter of 2022 compared with $75.2 million at the end of 2021.

Other Aspects of Q222 Outlook

Landstar anticipates second-quarter 2022 revenues in the range of $2.0-$2.05 billion. 

Revenue per load on loads hauled via truck in the second quarter of 2022 is expected in a mid-teen percentage range above the second-quarter 2021 reported figure.
 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates revision.

The consensus estimate has shifted 16.69% due to these changes.

VGM Scores

Currently, Landstar has a great Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Landstar has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.