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Kirby (KEX) Reaches Conclusion for Distribution and Services

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Kirby Corporation (KEX - Free Report) recently announced that its board of directors has concluded their review of strategic alternatives for the Distribution and Services business, which was initiated in early 2022.

KEX’s board of directors (along with its independent financial and legal advisors) reviewed multiple alternatives, including a sale or spin-off of its Distribution and Services business.

Considering the existing financial market conditions and the M&A market being affected by macroeconomic headwinds, KEX’s board has decided to continue operating with both its businesses - Marine Transportation and Distribution and Services. KEX is looking forward to all opportunities which will maximize its shareholders value.

Joseph H. Pyne, Kirby’s chairman of the board, stated, “Following a thorough review of strategic alternatives, the Kirby Board determined that the best way to enhance shareholder value is to continue to execute on the strategic plan for both the Marine Transportation and Distribution and Services businesses at this time.”

Kirby anticipates favorable conditions for inland marine transportation and oil and gas markets that should boost growth for its products and services. For the Distribution and Services segment, KEX expects demand for its environmental friendly pressure pumping and e-frac power generation equipment.

Kirby is hopeful of delivering better financial results throughout 2023 as it stays focused on cost and capital management and remains open to growth opportunities.

David Grzebinski, Kirby’s president and chief executive officer, stated, “The Board and management team are confident in Kirby’s prospects for continued profitable growth and value creation, as underscored by our strong financial results and operating performance in 2022. In Distribution and Services, our markets remained strong throughout 2022 and contributed to Kirby’s meaningful year-over-year growth in revenue and operating margin. We are encouraged by the bright prospects of the Company’s two segments and look forward to continuing to operate these businesses from a position of strength. As always, we remain open-minded and eager to consider strategic options to maximize value creation.”

Zacks Rank and Stocks to Consider

Kirby currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader Zacks Transportation sector are American Airlines (AAL - Free Report) ), Teekay Tankers Ltd. (TNK - Free Report) ) and Gol Linhas Aereas Inteligentes S.A.. American Airlines and Teekay Tankers sport a Zacks Rank #1(Strong Buy), while Gol Linhas currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

AAL has an expected earnings growth rate of more than 100% for the current year. AAL delivered a trailing four-quarter earnings surprise of 8.62%, on average.

The Zacks Consensus Estimate for AAL’s current-year earnings has improved 19.3% over the past 90 days. Shares of AAL have gained 5.6% over the past six months.

Teekay Tankers has an expected earnings growth rate of 143.11% for the current year. TNK delivered a trailing four-quarter earnings surprise of 42.23%, on average. Teekay Tankers has a long-term expected growth rate of 3%.

The Zacks Consensus Estimate for TNK’s current-year earnings has improved more than 100% over the past 90 days. Shares of TNK have soared 67.9% over the past six months.

Gol Linhas has an expected earnings growth rate of 50.9% for the current year.

Shares of GOL have gained 6.4% over the past three months.


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