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Here's Why Investors Should Give Schneider Stock 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 Revision: The Zacks Consensus Estimate for current-quarter earnings has moved 22.2% south in the past 90 days. For the current year, the consensus mark for earnings has been revised downward by 19.6% in the same time frame. The unfavorable estimate revisions indicate brokers’ lack of confidence in the stock.

Dim Price Performance:  The company’s price trend reveals that its shares have lost 20.6% over the past six months compared with the transportation-services industry’s 8.1% decline.

SNDR Stock Six-Month Price Comparison

Zacks Investment Research
Image Source: Zacks Investment Research

Weak Zacks Rank: SNDR currently carries a Zacks Rank #5 (Strong Sell).

Other Headwinds: Schneider has reduced its 2025 adjusted earnings per share guidance to the range of 75 cents-$1.00 from the previously guided range of 90 cents-$1.20. The current macroeconomic environment is leading to declining consumer sentiment and increasing shipper uncertainty, which has led to the tempered outlook.

Schneider's top line is hurt by lower Network volumes and lower brokerage revenue per order, despite the benefits of the Cowan Systems acquisition. Market volatility and rising costs continue to challenge SNDR, potentially impacting its growth and earnings in the near term.

The company's bottom line is significantly affected by the ongoing inflationary environment and supply-chain disruptions, which are driving up overall costs, particularly in the insurance domain, and directly impacting operating expenses. Increased insurance expense and weakness in the freight market continue to hurt SNDR’s prospects.

Bearish Industry Rank 

The industry to which SNDR belongs currently has a Zacks Industry Rank of 170 (out of 247 groups). Such a weak rank places the industry in the bottom 31% of the Zacks industries. Studies have shown that 50% of a stock price movement is directly tied to the performance of the industry group that it hails from.

In fact, a robust stock in a weak industry is likely to underperform an ordinary stock in a strong group. Therefore, considering the industry’s performance becomes imperative.

Stocks to Consider

Investors interested in the Transportation sector may also consider Copa Holdings (CPA - Free Report) and Ryanair (RYAAY - Free Report) .

CPA currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

CPA has an expected earnings growth rate of 13.1% for the current year. The company has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 5.5%. Shares of CPA have risen 16.5% year to date.

RYAAY currently sports a Zacks Rank #1.

The company has a mixed earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, delivering an average beat of 44.5%. Shares of RYAAY have rallied 15.6% year to date.


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Ryanair Holdings PLC (RYAAY) - free report >>

Copa Holdings, S.A. (CPA) - free report >>

Schneider National, Inc. (SNDR) - free report >>

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