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Why Is Landstar (LSTR) Down 6.5% Since Last Earnings Report?

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A month has gone by since the last earnings report for Landstar System (LSTR - Free Report) . Shares have lost about 6.5% in that time frame, underperforming 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 the most recent earnings report in order to get a better handle on the important drivers.

Landstar Q4 Earnings Miss Estimates

Landstar's fourth-quarter 2024 earnings per share (EPS) of $1.31 missed the Zacks Consensus Estimate of $1.36 and fell 19.1% year over year. The reported figure quarter lies within the guided range of $1.25-$1.45 per share

Revenues of $1.21 billion surpassed the Zacks Consensus Estimate of $1.19 billion as well as grew 0.4% year over year. The reported figure quarter lies within the guided range of $1.150 - $1.250 billion.

Operating income fell 22.5% from the prior-year quarter’s figure to $57.77 million. Total costs and expenses (on a reported basis) increased 1.9% to $1.15 billion.

Segmental Details

Total revenues in the truck transportation segment — contributing to 89.8% of the top line — amounted to $1.08 billion, down 0.4% from the year-ago quarter’s figure.

Rail intermodal revenues of $18.34 million decreased 24.6% from the figure recorded in fourth-quarter 2023. Revenues in the ocean and air-cargo carrier segments improved 37.1% year over year to $88.17 million. Other revenues decreased 28.4% to $22 million.

Liquidity, Dividends & Buyback

At the end of fourth-quarter 2024, Landstar had cash and cash equivalents of $515.01 million compared with $468.83 million recorded at the prior-quarter end. Additionally, long-term debt (excluding current maturities) totaled $69.19 million at the end of the fourth quarter compared with $44.83 million at the prior-quarter end.

During 2024, Landstar purchased almost 452,000 shares for $82.1 million and paid $120.5 million in the form of cash dividends. LSTR is currently authorized to purchase up to an additional 2,547,981 shares under its longstanding share purchase program.  

Landstar’s board of directorsdeclared a quarterly cash dividend of 36 cents per share payable on Mar 11, 2025, to stockholders of record at the close of business on Feb 18, 2025.

First-Quarter 2025 Guidance

LSTR expects first-quarter revenues in the range of$1.075 - $1.175 billion. EPS is expected to be in the range of $1.05-$1.25 per share.

LSTR expects first-quarter 2025 truckloads to decline in the range of 2-7% on a year-over-year basis. Truck revenue per load is expected to be down 2% to up 3% on a year-over-year basis.

Effective income tax rate is expected at 24.5%.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates.

The consensus estimate has shifted -14.92% due to these changes.

VGM Scores

At this time, Landstar has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. Charting a somewhat similar path, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

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

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Landstar has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.


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