As the craze of earnings season draws to a close, here’s a look back at some of the most exciting (and some less so) results from Q1. Today, we are looking at vehicle parts distributors stocks, starting with FTAI Aviation (NASDAQ: FTAI).
Supply chain and inventory management are themes that grew in focus after COVID wreaked havoc on the global movement of raw materials and components. Transportation parts distributors that boast reliable selection in sometimes specialized areas combined and quickly deliver products to customers can benefit from this theme. Additionally, distributors who earn meaningful revenue streams from aftermarket products can enjoy more steady top-line trends and higher margins. But like the broader industrials sector, transportation parts distributors are also at the whim of economic cycles that impact capital spending, transportation volumes, and demand for discretionary parts and components.
The 4 vehicle parts distributors stocks we track reported a satisfactory Q1. As a group, revenues beat analysts’ consensus estimates by 1.1%.
Thankfully, share prices of the companies have been resilient as they are up 9.7% on average since the latest earnings results.
FTAI Aviation (NASDAQ: FTAI)
With a focus on the CFM56 engine that powers Boeing and Airbus’s planes, FTAI Aviation (NASDAQ: FTAI) sells, leases, maintains, and repairs aircraft engines.
FTAI Aviation reported revenues of $502.1 million, up 53.7% year on year. This print fell short of analysts’ expectations by 2.1%. Overall, it was a decent quarter for the company with an impressive beat of analysts’ EBITDA estimates.
FTAI Aviation scored the fastest revenue growth but had the weakest performance against analyst estimates of the whole group. The stock is up 14.9% since reporting and currently trades at $123.
Is now the time to buy FTAI Aviation? Access our full analysis of the earnings results here, it’s free.
Best Q1: Air Lease (NYSE: AL)
Established by a founder of Century City in Los Angeles, Air Lease Corporation (NYSE: AL) provides aircraft leasing and financing solutions to airlines worldwide.
Air Lease reported revenues of $738.3 million, up 11.3% year on year, outperforming analysts’ expectations by 3.9%. The business had an incredible quarter with a solid beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates.
Air Lease delivered the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 18.1% since reporting. It currently trades at $57.59.
Is now the time to buy Air Lease? Access our full analysis of the earnings results here, it’s free.
Weakest Q1: GATX (NYSE: GATX)
Originally founded to ship beer, GATX (NYSE: GATX) provides leasing and management services for railcars and other transportation assets globally.
GATX reported revenues of $421.6 million, up 11% year on year, exceeding analysts’ expectations by 1.1%. Still, it was a slower quarter as it posted a significant miss of analysts’ EBITDA estimates.
Interestingly, the stock is up 5.4% since the results and currently trades at $156.06.
Read our full analysis of GATX’s results here.
Rush Enterprises (NASDAQ: RUSHA)
Headquartered in Texas, Rush Enterprises (NASDAQ: RUSH.A) provides truck-related services and solutions, including sales, leasing, parts, and maintenance for commercial vehicles.
Rush Enterprises reported revenues of $1.85 billion, down 1.1% year on year. This print surpassed analysts’ expectations by 1.4%. More broadly, it was a mixed quarter as it also recorded EBITDA in line with analysts’ estimates.
Rush Enterprises had the slowest revenue growth among its peers. The stock is flat since reporting and currently trades at $51.18.
Read our full, actionable report on Rush Enterprises here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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