Back to top

Image: Bigstock

Why Is Ryder (R) Down 3.5% Since Last Earnings Report?

Read MoreHide Full Article

It has been about a month since the last earnings report for Ryder (R - Free Report) . Shares have lost about 3.5% in that time frame, outperforming the S&P 500.

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

Earnings Beat at Ryder in Q2

Quarterly earnings (excluding $4.01 from non-recurring items) of $3.61 per share surpassed the Zacks Consensus Estimate of $2.97. However, the bottom line plunged 18.5% year over year largely reflecting weaker market conditions in used vehicle sales and rental.

Total revenues of $2,884 million missed the Zacks Consensus Estimate of $3000.8 million. The top line decreased 4.9% year over year.

Segmental Results

Fleet Management Solutions: Total revenues of $1,459 million were down 10% year over year. The actual percentage of decline was steeper than our expectation of a 3.7% year-over-year fall. Operating revenues summed $1,254 million, down 4% year over year. Segmental revenues were hurt by negative impact of operating revenues from UK exit.

Supply-Chain Solutions: Total revenues of $1,179 million remained flat year over year. We estimated a 2% rise from second-quarter 2022 actuals. Operating revenues rose 8% year over year to $865 million on the back of strong revenue growth in all industry verticals primarily reflecting new business, higher volumes and increased pricing.

Dedicated Transportation Solutions: Total revenues amounted to $440 million, down 2% from the year-ago quarter. Operating revenues climbed 7% to $327 million. The uptick was driven by inflationary cost recovery and higher volumes.


Ryder exited the second quarter with cash and cash equivalents of $218 million compared with $267 million at the end of December 2022. R’s total debt (including the current portion) was $6,525 million at second-quarter end compared with $6,352 million reported at the end of 2022.

Q3 & 2023 Outlook

For third-quarter 2023, Ryder expects adjusted earnings per share in the range of $3.00-$3.25. For 2023, management anticipates total revenues to decrease by 2% while operating revenues to increase by 2%. Adjusted EPS for the year is now estimated to be between $12.20 and $12.70 (prior view: $11.30-$12.05).

R now estimates free cash flow of $100 million for 2023 (prior view: $200 million). Net cash from operating activities is projected to be $2.5 billion (prior view: $2.4 billion). Adjusted ROE (return on equity) is still suggested in the 17-19% band (prior view: 16-18%). Capital expenditure is estimated to be $3.2 billion (prior view: $3 billion).

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 8.43% due to these changes.

VGM Scores

At this time, Ryder has an average Growth Score of C, a grade with the same score on the momentum front. However, the stock was allocated a grade of A on the value side, putting it in the top quintile 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.


Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Ryder has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Ryder System, Inc. (R) - free report >>

Published in