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Here's Why Investors Should Give Schneider (SNDR) a Miss Now
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Schneider National, Inc. (SNDR - Free Report) is currently mired in multiple headwinds, which, we believe, have made it an unimpressive investment option.
Let’s delve deeper.
Southward Earnings Estimate Revisions: The Zacks Consensus Estimate for current-quarter earnings has been revised 52.2% downward over the past 90 days. For 2023 and 2024, the consensus mark for earnings has moved downward by 20.5% and 17.3% in the same time frame, respectively. The unfavorable estimate revisions indicate brokers’ lack of confidence in the stock.
Weak Zacks Rank and Style Score: Schneider currently carries a Zacks Rank #5 (Strong Sell). Moreover, the company’s current Momentum Style Score of F shows its short-term unattractiveness.
Unimpressive Price Performance: SNDR has lost 21% over the past three months compared with the industry’s 11% decline.
Image Source: Zacks Investment Research
Other Headwinds: Schneider is being hurt by weakness across all segments. Below-par performance in the Truckload (due to lower network price), Intermodal (due to lower volume and revenue per order) and Logistics (due to a decline in revenue per order impacted by lower spot prices, and a decrease in brokerage volume) segments is hurting Schneider’s top line.
Additionally, the lower outlook for 2023 looks disappointing. Schneider’s board has decreased its 2023 adjusted earnings per share guidance in the range of $1.40-$1.45 (prior view: $1.75-$1.90).
Bearish Industry Rank: The industry, to which SNDR belongs, currently has a Zacks Industry Rank of 206 (of 250 plus groups). Such an unfavorable rank places it in the bottom 18% of the Zacks industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it belongs to.
A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Therefore, reckoning the industry’s performance becomes imperative.
Wabtec has an expected earnings growth rate of 22.02% for the current year. WAB delivered a trailing four-quarter earnings surprise of 7.11%, on average.
The Zacks Consensus Estimate for WAB’s current-year earnings has improved 5.1% over the past 90 days. Shares of WAB have gained 17.3% year to date.
SkyWest's fleet-modernization efforts are commendable. The Zacks Consensus Estimate for SKYW’s current-year earnings has improved 31.5% over the past 90 days. Shares of SKYW have surged 181.3% year to date.
SKYW delivered a trailing four-quarter earnings surprise of 32.57%, on average.
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Here's Why Investors Should Give Schneider (SNDR) a Miss Now
Schneider National, Inc. (SNDR - Free Report) is currently mired in multiple headwinds, which, we believe, have made it an unimpressive investment option.
Let’s delve deeper.
Southward Earnings Estimate Revisions: The Zacks Consensus Estimate for current-quarter earnings has been revised 52.2% downward over the past 90 days. For 2023 and 2024, the consensus mark for earnings has moved downward by 20.5% and 17.3% in the same time frame, respectively. The unfavorable estimate revisions indicate brokers’ lack of confidence in the stock.
Weak Zacks Rank and Style Score: Schneider currently carries a Zacks Rank #5 (Strong Sell). Moreover, the company’s current Momentum Style Score of F shows its short-term unattractiveness.
Unimpressive Price Performance: SNDR has lost 21% over the past three months compared with the industry’s 11% decline.
Image Source: Zacks Investment Research
Other Headwinds: Schneider is being hurt by weakness across all segments. Below-par performance in the Truckload (due to lower network price), Intermodal (due to lower volume and revenue per order) and Logistics (due to a decline in revenue per order impacted by lower spot prices, and a decrease in brokerage volume) segments is hurting Schneider’s top line.
Additionally, the lower outlook for 2023 looks disappointing. Schneider’s board has decreased its 2023 adjusted earnings per share guidance in the range of $1.40-$1.45 (prior view: $1.75-$1.90).
Bearish Industry Rank: The industry, to which SNDR belongs, currently has a Zacks Industry Rank of 206 (of 250 plus groups). Such an unfavorable rank places it in the bottom 18% of the Zacks industries. Studies show that 50% of a stock price movement is directly related to the performance of the industry group it belongs to.
A mediocre stock within a strong group is likely to outclass a robust stock in a weak industry. Therefore, reckoning the industry’s performance becomes imperative.
Stocks to Consider
Some better-ranked stocks from the Zacks Transportation sector are Westinghouse Air Brake Technologies Corporation, operating as Wabtec Corporation (WAB - Free Report) and SkyWest, Inc. (SKYW - Free Report) . Each stock presently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Wabtec has an expected earnings growth rate of 22.02% for the current year. WAB delivered a trailing four-quarter earnings surprise of 7.11%, on average.
The Zacks Consensus Estimate for WAB’s current-year earnings has improved 5.1% over the past 90 days. Shares of WAB have gained 17.3% year to date.
SkyWest's fleet-modernization efforts are commendable. The Zacks Consensus Estimate for SKYW’s current-year earnings has improved 31.5% over the past 90 days. Shares of SKYW have surged 181.3% year to date.
SKYW delivered a trailing four-quarter earnings surprise of 32.57%, on average.