It has been about a month since the last earnings report for Expeditors International (EXPD - Free Report) . Shares have added about 3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Expeditors International due for a pullback? 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.
Expeditors' Q3 Earnings & Revenues Beat Estimates
The company’s earnings of 92 cents per share, surpassed the Zacks Consensus Estimate by 14 cents. Also, the bottom line increased more than 39% on a year-over-year basis. Results were aided by higher revenues and a lower effective tax rate.
Effective tax rate in the reported quarter was 21.8%, compared with 36.7% a year ago. Revenues came in at $2.09 billion outpacing the Zacks Consensus Estimate of $2.03 billion. The top line improved 16% from the year-ago figure.
Growth was witnessed across all major divisions of the company. Volumes with respect to airfreight tonnage and ocean container increased 1% and 8%, respectively, on a year-over-year basis.
Gross profit (net revenues) increased 10% year over year in the third quarter of 2018 to $661.31 million. Gross margin (yield) came in at 31.6% compared with 33.2% in the year-ago quarter. In the third quarter, the company repurchased 2 million shares at an average price of $73.47 per share. The company exited the quarter with cash and cash equivalents of $990.61 million compared with $1.05 billion at the end of 2017.
Airfreight Services revenues improved 13.3% year over year to $833.33 million in the third quarter. Ocean Freight and Ocean Services revenues increased 4% to $585.81 million. Customs Brokerage and Other Services revenues increased 33.4 % year over year to approximately $671.8 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed an upward trend in fresh estimates.
At this time, Expeditors International has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% 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.
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Expeditors International has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.