What Happened?
Shares of marine transportation service company Kirby (NYSE: KEX) jumped 5% in the morning session after the stock's positive momentum continued as the company reported third-quarter earnings that surpassed analyst expectations and earned a price target increase. Kirby's net earnings for the quarter reached $92.5 million, or $1.65 per share, an increase from $1.55 per share in the same period of the previous year. This profit figure beat consensus estimates. Total revenues grew to $871.2 million. A key driver for this performance was the Distribution and Services segment, where revenue jumped 12% year-over-year, largely due to strong demand in power generation. The company also repurchased 1.314 million of its shares for $120.0 million during the quarter. Following the positive results, Wolfe Research raised its price target on the stock to $119 from $101, pointing to an improved outlook for the fourth quarter.
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What Is The Market Telling Us
Kirby’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 16% on the news that the company reported strong third-quarter financial results that surpassed analyst expectations for both revenue and profit. The marine transportation service company announced revenue of $871.2 million, representing 4.8% growth year-on-year and beating Wall Street's estimates. Its profit also came in ahead of expectations, with earnings per share of $1.65, up from $1.55 in the same quarter last year. The results were further supported by strong cash generation, as the company's free cash flow margin increased to 18.4%, up from 15.7% in the prior year's quarter. This indicates improved efficiency in converting its profits into cash, a positive sign for investors.
Kirby is flat since the beginning of the year, and at $106 per share, it is trading 18.8% below its 52-week high of $130.55 from November 2024. Investors who bought $1,000 worth of Kirby’s shares 5 years ago would now be looking at an investment worth $2,754.
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