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Werner (WERN) Shares Rise 4.6% Despite Q4 Earnings Miss
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Werner Enterprises, Inc. (WERN - Free Report) shares gained 4.6% since its fourth-quarter 2023 earnings release on Feb 6. Quarterly earnings per share (EPS) of 39 cents lagged the Zacks Consensus Estimate of 44 cents and declined 61% on a year-over-year basis.
Total revenues of $821.9 million outperformed the Zacks Consensus Estimate of $811.1 million. However, the top line dipped 5% on a year-over-year basisdue to a $54.7 million decrease in Truckload Transportation Services (TTS) revenues, partially offset by Logistics revenue growth of $13.5 million, which includes the ReedTMS acquisition.
Adjusted operating income of $39.2 million fell 56% year over year. Adjusted operating margin of 4.8% declined 560 basis points from the year-ago reported quarter.
Werner Enterprises, Inc. Price, Consensus and EPS Surprise
Revenues in the TTS segment fell 9% on a year-over-year basis to $580.09 million due to lower fuel surcharge revenues. Adjusted operating income of $37.2 million fell 55% year over year owing to a lower rate per mile in One-Way Truckload, smaller overall fleet size, and lower gains on the sale of property and equipment. Adjusted operating margin decreased 670 basis points to 6.4%.
Logistics’ revenues totaled $226.96 million, up 6% year over year. Adjusted operating income of $3.0 million fell 62%. Adjusted operating margin of 1.3% fell 250 basis points.
Liquidity
As of Dec 31, 2023, Werner had cash and cash equivalents of $61.72 million compared with $42.75 million at the third-quarter end. Long-term debt (net of current portion) totaled $646.25 million at the end of the fourth quarter compared with $686.25 million at the prior-quarter end.
The company generated $118.3 million of cash from operations in fourth-quarter 2023. Net capital expenditure amounted to $34.5 million.
In the quarter under review, Werner did not repurchase any shares. As of Dec 31, 2023, WERN had 2.3 million shares available under its share repurchase authorization.
Outlook
For 2024, Werner anticipates TTS truck growth between (3%) and breakeven.
Net capital expenditure is estimated to be in the range of $260-$310 million. Under the TTS guidance, WERN projects dedicated revenues per truck per week growth to rise from breakeven to 3% in 2024.
One-way Truckload revenues per total mile are predicted to decline 6-3%. Werner expects the average truck age to be 2.1 years for 2024, while the trailer age is forecasted to be five years.
Full-year 2024 tax rate is anticipated to be in the range of 24.5%-25.5%.
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) fourth-quarter 2023 EPS of $1.47 missed the Zacks Consensus Estimate of $1.74 and declined 23.4% year over year.
JBHT’s total operating revenues of $3,303.70million surpassed the Zacks Consensus Estimate of $3,236.2 million but fell 9.5% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 6% year over year.
Delta Air Lines (DAL - Free Report) has reported fourth-quarter 2023 EPS (excluding $1.88 from non-recurring items) of $1.28, which comfortably beat the Zacks Consensus Estimate of $1.17. Earnings, however, declined 13.51% on a year-over-year basis due to high labor costs.
Revenues of $14,223 million surpassed the Zacks Consensus Estimate of $14,069.5 million and increased 5.87% on a year-over-year basis, driven by strong holiday-air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $13,661 million, up 11% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported fourth-quarter 2023 EPS (excluding 19 cents from non-recurring items) of $2.00, which outpaced the Zacks Consensus Estimate of $1.61 but declined 18.7% year over year.
Operating revenues of $13,626 million beat the Zacks Consensus Estimate of $13,546.8 million. The top line increased 9.9% year over year due to upbeat air-travel demand. This was driven by a 10.9% rise in passenger revenues (accounting for 91.1% of the top line) to $12,421 million. Almost 41,779 passengers traveled on UAL flights in the fourth quarter.
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Werner (WERN) Shares Rise 4.6% Despite Q4 Earnings Miss
Werner Enterprises, Inc. (WERN - Free Report) shares gained 4.6% since its fourth-quarter 2023 earnings release on Feb 6. Quarterly earnings per share (EPS) of 39 cents lagged the Zacks Consensus Estimate of 44 cents and declined 61% on a year-over-year basis.
Total revenues of $821.9 million outperformed the Zacks Consensus Estimate of $811.1 million. However, the top line dipped 5% on a year-over-year basisdue to a $54.7 million decrease in Truckload Transportation Services (TTS) revenues, partially offset by Logistics revenue growth of $13.5 million, which includes the ReedTMS acquisition.
Adjusted operating income of $39.2 million fell 56% year over year. Adjusted operating margin of 4.8% declined 560 basis points from the year-ago reported quarter.
Werner Enterprises, Inc. Price, Consensus and EPS Surprise
Werner Enterprises, Inc. price-consensus-eps-surprise-chart | Werner Enterprises, Inc. Quote
Segmental Results
Revenues in the TTS segment fell 9% on a year-over-year basis to $580.09 million due to lower fuel surcharge revenues. Adjusted operating income of $37.2 million fell 55% year over year owing to a lower rate per mile in One-Way Truckload, smaller overall fleet size, and lower gains on the sale of property and equipment. Adjusted operating margin decreased 670 basis points to 6.4%.
Logistics’ revenues totaled $226.96 million, up 6% year over year. Adjusted operating income of $3.0 million fell 62%. Adjusted operating margin of 1.3% fell 250 basis points.
Liquidity
As of Dec 31, 2023, Werner had cash and cash equivalents of $61.72 million compared with $42.75 million at the third-quarter end. Long-term debt (net of current portion) totaled $646.25 million at the end of the fourth quarter compared with $686.25 million at the prior-quarter end.
The company generated $118.3 million of cash from operations in fourth-quarter 2023. Net capital expenditure amounted to $34.5 million.
In the quarter under review, Werner did not repurchase any shares. As of Dec 31, 2023, WERN had 2.3 million shares available under its share repurchase authorization.
Outlook
For 2024, Werner anticipates TTS truck growth between (3%) and breakeven.
Net capital expenditure is estimated to be in the range of $260-$310 million. Under the TTS guidance, WERN projects dedicated revenues per truck per week growth to rise from breakeven to 3% in 2024.
One-way Truckload revenues per total mile are predicted to decline 6-3%. Werner expects the average truck age to be 2.1 years for 2024, while the trailer age is forecasted to be five years.
Full-year 2024 tax rate is anticipated to be in the range of 24.5%-25.5%.
Werner carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performances of Other Transportation Companies
J.B. Hunt Transport Services, Inc.’s (JBHT - Free Report) fourth-quarter 2023 EPS of $1.47 missed the Zacks Consensus Estimate of $1.74 and declined 23.4% year over year.
JBHT’s total operating revenues of $3,303.70million surpassed the Zacks Consensus Estimate of $3,236.2 million but fell 9.5% year over year. Total operating revenues, excluding fuel surcharge revenue, fell 6% year over year.
Delta Air Lines (DAL - Free Report) has reported fourth-quarter 2023 EPS (excluding $1.88 from non-recurring items) of $1.28, which comfortably beat the Zacks Consensus Estimate of $1.17. Earnings, however, declined 13.51% on a year-over-year basis due to high labor costs.
Revenues of $14,223 million surpassed the Zacks Consensus Estimate of $14,069.5 million and increased 5.87% on a year-over-year basis, driven by strong holiday-air-travel demand. Adjusted operating revenues (excluding third-party refinery sales) came in at $13,661 million, up 11% year over year.
United Airlines Holdings, Inc. (UAL - Free Report) reported fourth-quarter 2023 EPS (excluding 19 cents from non-recurring items) of $2.00, which outpaced the Zacks Consensus Estimate of $1.61 but declined 18.7% year over year.
Operating revenues of $13,626 million beat the Zacks Consensus Estimate of $13,546.8 million. The top line increased 9.9% year over year due to upbeat air-travel demand. This was driven by a 10.9% rise in passenger revenues (accounting for 91.1% of the top line) to $12,421 million. Almost 41,779 passengers traveled on UAL flights in the fourth quarter.