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Here's Why You Should Give Schneider National Stock a Miss Now
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Key Takeaways
Q2 2025 operating expenses rose 7.9%, led by a 13.3% surge in labor costs.
The Logistics segment's profit fell 29%, with the operating ratio worsening to 97.7%.
SNDR shares have dropped 15.6%, lagging the Transportation - Services industry's 0.3% dip.
Schneider National, Inc. (SNDR - Free Report) is grappling with increased cost pressure due to supply-chain disruptions and inflation. The soft freight market condition is also a major headwind, hurting the company’s prospects,making it an unattractive choice for investors’ portfolios.
Let’s delve deeper.
SNDR: Key Risks to Watch
Southward Earnings Estimate Revision: The Zacks Consensus Estimate for the current-quarter earnings has been revised 4.4% downward over the past 60 days and is pegged at 22 cents per share. Meanwhile, the Zacks Consensus Estimate for 2025 earnings stands at 84 cents per share, indicating a 2.33% fall over the past 60 days.
The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.
Dim Price Performance: The company’s price trend reveals that its shares have fallen 15.6% compared with the Transportation - Services industry’s 0.3% decline.
Image Source: Zacks Investment Research
Unimpressive Earnings Surprise: SNDR has a mixed earnings surprise history, having outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missing once, delivering an average surprise of 1.86%.
Weak Zacks Rank: SNDR currently carries a Zacks Rank #4 (Sell).
Bearish Industry Rank: The industry to which Schneider National belongs currently has a Zacks Industry Rank of 224 (out of 245). Such an unfavorable rank places it in the bottom 9% of 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. Reckoning the industry’s performance becomes imperative in this case.
Headwinds: Schneider National is struggling with mounting cost pressures that are weighing heavily on its bottom line. In the second quarter of 2025, operating expenses climbed 7.9% year over year, largely driven by surging labor costs.
Labor expenses, including salaries, wages and benefits, which account for 29.2% of total operating costs, spiked 13.3% from the prior year. The ongoing inflationary environment and persistent supply-chain disruptions have exacerbated cost pressures, particularly in the insurance segment, intensifying the strain on operating margins. Additionally, rising insurance expenses and a soft freight market continue to undermine SNDR’s overall financial performance.
Moreover, SNDR's logistics segment also faced significant margin pressures in the second quarter of 2025. Income from operations fell to $7.9 million, marking a 29% decline from the prior year, driven by lower brokerage volumes. Adding to the concern, the logistics operating ratio deteriorated to 97.7% from 96.5% a year ago, reflecting a 120-basis-point decline in efficiency. This trend underscores rising cost pressures and softer demand dynamics in the logistics business, weighing on profitability.
LTM has an expected earnings growth rate of 45% for the current year. The company has a mixed earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters, missed once and met in the remaining one, delivering an average beat of 4.04%.
SKYW currently sports a Zacks Rank #1.
SkyWest has an expected earnings growth rate of 28.06% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.92%.
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Here's Why You Should Give Schneider National Stock a Miss Now
Key Takeaways
Schneider National, Inc. (SNDR - Free Report) is grappling with increased cost pressure due to supply-chain disruptions and inflation. The soft freight market condition is also a major headwind, hurting the company’s prospects,making it an unattractive choice for investors’ portfolios.
Let’s delve deeper.
SNDR: Key Risks to Watch
Southward Earnings Estimate Revision: The Zacks Consensus Estimate for the current-quarter earnings has been revised 4.4% downward over the past 60 days and is pegged at 22 cents per share. Meanwhile, the Zacks Consensus Estimate for 2025 earnings stands at 84 cents per share, indicating a 2.33% fall over the past 60 days.
The unfavorable estimate revision indicates brokers’ lack of confidence in the stock.
Dim Price Performance: The company’s price trend reveals that its shares have fallen 15.6% compared with the Transportation - Services industry’s 0.3% decline.
Image Source: Zacks Investment Research
Unimpressive Earnings Surprise: SNDR has a mixed earnings surprise history, having outpaced the Zacks Consensus Estimate in three of the trailing four quarters and missing once, delivering an average surprise of 1.86%.
Weak Zacks Rank: SNDR currently carries a Zacks Rank #4 (Sell).
Bearish Industry Rank: The industry to which Schneider National belongs currently has a Zacks Industry Rank of 224 (out of 245). Such an unfavorable rank places it in the bottom 9% of 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. Reckoning the industry’s performance becomes imperative in this case.
Headwinds: Schneider National is struggling with mounting cost pressures that are weighing heavily on its bottom line. In the second quarter of 2025, operating expenses climbed 7.9% year over year, largely driven by surging labor costs.
Labor expenses, including salaries, wages and benefits, which account for 29.2% of total operating costs, spiked 13.3% from the prior year. The ongoing inflationary environment and persistent supply-chain disruptions have exacerbated cost pressures, particularly in the insurance segment, intensifying the strain on operating margins. Additionally, rising insurance expenses and a soft freight market continue to undermine SNDR’s overall financial performance.
Moreover, SNDR's logistics segment also faced significant margin pressures in the second quarter of 2025. Income from operations fell to $7.9 million, marking a 29% decline from the prior year, driven by lower brokerage volumes. Adding to the concern, the logistics operating ratio deteriorated to 97.7% from 96.5% a year ago, reflecting a 120-basis-point decline in efficiency. This trend underscores rising cost pressures and softer demand dynamics in the logistics business, weighing on profitability.
Stocks to Consider
Investors interested in the Transportation sector may consider LATAM Airlines Group (LTM - Free Report) and SkyWest (SKYW - Free Report) .
LTM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
LTM has an expected earnings growth rate of 45% for the current year. The company has a mixed earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters, missed once and met in the remaining one, delivering an average beat of 4.04%.
SKYW currently sports a Zacks Rank #1.
SkyWest has an expected earnings growth rate of 28.06% for the current year. The company has an encouraging earnings surprise history. Its earnings topped the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average beat of 21.92%.