The transportation sector has been off to a strong start this earnings season. Most industry players managed to beat on earnings or revenues or on both counts, instilling huge optimism in the space (see: all the Industrials ETFs here).
For a better understanding, let’s delve into the results of some well-known industry players: Transportation Earnings in Focus The world's largest package delivery company United Parcel Service’s ( top and the bottom line beat the Zacks Consensus Estimate. Earnings of $2.07 were a penny ahead of the consensus mark while revenues of $18.32 billion edged past the estimated $18.3 billion. For 2019, the company reiterated earnings per share in the range of $7.45-$7.75. UPS Quick Quote UPS - Free Report) Union Pacific missed the Zacks Consensus Estimate for earnings by 7 cents and that for revenues by $107 million. Meanwhile, UNP Kansas City Southern’s earnings of $1.94 per share topped estimates by 17 cents while revenues of $748 million came ahead of the estimated $730 million. KSU U.S. airlines Delta Air Lines and DAL United Continental beat on earnings but lagged on revenues. Earnings per share at Delta and United Continental trumped the Zacks Consensus Estimate by 5 cents and 13 cents, respectively. Revenues of $12.56 billion for Delta and $11.4 billion for United Continental were below the estimated $12.62 billion and $11.42 billion, respectively (read: UAL 4 Sector ETFs & Stocks to Bet on Ahead of Q3 Earnings). Delta projects weaker-than-expected earnings per share for the ongoing quarter, forecasting EPS of $1.20-$1.50. The midpoint is much lower than the Zacks Consensus Estimate of $1.50. United Continental raised its full-year earnings guidance from $10.5-$12 to $11.25-$12.25. The mid-point of the new range was below the Zacks Consensus Estimate of $11.81. Last but not the least, leading trucking carrier J.B. Hunt missed on earnings by 4 cents per share while revenues of $2.36 billion topped the consensus estimate of $2.34 billion. JBHT ETFs in Focus Solid results have led to smooth trading in transportation ETFs over the past week. iShares Transportation Average ETF , IYT SPDR S&P Transportation ETF and XTN First Trust Nasdaq Transportation ETF all gained more than 3% in the same time frame. However, all these ETFs have a Zacks ETF Rank #4 (Sell). FTXR IYT The fund tracks the Dow Jones Transportation Average Index, giving investors exposure to a small basket of 20 securities. The in-focus six firms make up for a combined 39.6% share. From a sector perspective, railroads, and air freight & logistics take the largest share with 32.6% and 24.6% share, respectively, while airlines and trucking round off the next two spots with double-digit exposure each. The fund has accumulated nearly $516.5 million in AUM and sees solid trading volume of around 228,000 shares a day. It charges 42 bps in annual fees (read: FedEx Disappoints: Transport ETFs in Focus). XTN This fund tracks the S&P Transportation Select Industry Index holding 44 stocks in its basket. The in-focus firms account for no more than 3% share each. Further, about 36.3% of the portfolio is dominated by trucking while airlines takes around one-fourth share. With AUM of $126 million, the fund charges 35 bps in fees per year from investors and trades in a lower volume of around 12,000 shares a day. FTXR This fund offers exposure to the 30 most-liquid U.S. transportation securities based on volatility, value and growth by tracking the Nasdaq US Smart Transportation Index. The in-focus six firms represent a combined 35.2% share. Ground freight & logistics takes the top spot at 30.4% while airlines, auto & truck manufacturers as well as auto, truck & motorcycle parts round off the next three. FTXR has accumulated $2.4 million in its asset base and charges 60 bps in annual fees. Average trading volume amounts to meager 4,000 shares. Want key ETF info delivered straight to your inbox? Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>