What Happened?
Shares of transportation company Schneider (NYSE: SNDR) jumped 4.5% in the afternoon session after the stock began to recover from a steep sell-off in the previous session, which was triggered by a disappointing third-quarter earnings report.
In the prior trading session, the company's shares fell sharply after it announced third-quarter adjusted earnings of $0.12 per share, missing analysts' consensus estimate of $0.21. A major factor in the earnings shortfall was a reported $16 million insurance claim cost. While Schneider's operating revenue of $1.5 billion marked a 10% increase from the previous year, the positive result was overshadowed by the earnings miss. Adding to the negative sentiment, the company also reduced its full-year 2025 earnings per share guidance to approximately $0.70. The stock's subsequent rise suggested a technical rebound after the initial negative market reaction.
After the initial pop the shares cooled down to $21.21, up 4.8% from previous close.
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What Is The Market Telling Us
Schneider’s shares are not very volatile and have only had 5 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 dropped 8.8% on the news that the company reported third-quarter results that missed profit expectations, even as revenue slightly topped forecasts. The transportation and logistics firm's revenue of $1.45 billion beat analyst forecasts by 1.4%, but its adjusted earnings of $0.12 per share fell 41.3% short of the $0.20 consensus estimate. Profitability was a key concern, as the company's adjusted EBITDA of $148.9 million also missed expectations by 10.2%. Furthermore, Schneider's free cash flow margin declined significantly to 5.2% from 8.6% in the same quarter last year, suggesting weaker cash generation. The significant earnings miss and weaker cash profitability overshadowed the revenue beat, leading to negative investor sentiment.
Schneider is down 27.2% since the beginning of the year, and at $21.21 per share, it is trading 36.9% below its 52-week high of $33.61 from November 2024. Investors who bought $1,000 worth of Schneider’s shares 5 years ago would now be looking at an investment worth $958.86.
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