As the Q2 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the ground transportation industry, including Saia (NASDAQ: SAIA) and its peers.
The growth of e-commerce and global trade continues to drive demand for shipping services, especially last-mile delivery, presenting opportunities for ground transportation companies. The industry continues to invest in data, analytics, and autonomous fleets to optimize efficiency and find the most cost-effective routes. Despite the essential services this industry provides, ground transportation companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.
The 16 ground transportation stocks we track reported a satisfactory Q2. As a group, revenues were in line with analysts’ consensus estimates.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 5.5% since the latest earnings results.
Saia (NASDAQ: SAIA)
Pivoting its business model after realizing there was more success in delivering produce than selling it, Saia (NASDAQ: SAIA) is a provider of freight transportation solutions.
Saia reported revenues of $817.1 million, flat year on year. This print exceeded analysts’ expectations by 1.2%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA estimates.
Saia President and CEO, Fritz Holzgrefe, commented on the quarter stating, "I was pleased with our team's ability to focus on what was within our control in the second quarter. Our continued emphasis on taking care of the customer in all of our markets, mix management, and managing costs to adjust to current volume trends demonstrated our ability to navigate a dynamic backdrop. "
Unsurprisingly, the stock is down 9.1% since reporting and currently trades at $282.55.
Is now the time to buy Saia? Access our full analysis of the earnings results here, it’s free for active Edge members.
Best Q2: Werner (NASDAQ: WERN)
Conducting business in over a 100 countries, Werner (NASDAQ: WERN) offers full-truckload, less-than-truckload, and intermodal delivery services.
Werner reported revenues of $753.1 million, down 1% year on year, outperforming analysts’ expectations by 3%. The business had a stunning quarter with a beat of analysts’ EPS estimates and an impressive beat of analysts’ adjusted operating income estimates.
However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $27.60.
Is now the time to buy Werner? Access our full analysis of the earnings results here, it’s free for active Edge members.
Weakest Q2: Heartland Express (NASDAQ: HTLD)
Founded by the son of a trucker, Heartland Express (NASDAQ: HTLD) offers full-truckload deliveries across the United States and Mexico.
Heartland Express reported revenues of $210.4 million, down 23.4% year on year, falling short of analysts’ expectations by 10.4%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.
Heartland Express delivered the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is flat since the results and currently trades at $8.73.
Read our full analysis of Heartland Express’s results here.
ArcBest (NASDAQ: ARCB)
Historically owning furniture, banking, and other subsidiaries, ArcBest (NASDAQ: ARCB) offers full-truckload, less-than-truckload, and intermodal deliveries of freight.
ArcBest reported revenues of $1.02 billion, down 5.2% year on year. This number lagged analysts' expectations by 2.8%. Overall, it was a softer quarter as it also produced a significant miss of analysts’ EPS and adjusted operating income estimates.
The stock is down 12.1% since reporting and currently trades at $71.98.
Read our full, actionable report on ArcBest here, it’s free for active Edge members.
Ryder (NYSE: R)
As one of the first companies to introduce the idea of leasing trucks, Ryder (NYSE: R) provides rental vehicles to businesses and delivers packages directly to homes or businesses.
Ryder reported revenues of $3.19 billion, flat year on year. This result topped analysts’ expectations by 0.8%. Overall, it was a very strong quarter as it also put up a solid beat of analysts’ adjusted operating income estimates.
The stock is up 13.6% since reporting and currently trades at $196.25.
Read our full, actionable report on Ryder here, it’s free for active Edge members.
Market Update
As a result of the Fed’s rate hikes in 2022 and 2023, inflation has come down from frothy levels post-pandemic. The general rise in the price of goods and services is trending towards the Fed’s 2% goal as of late, which is good news. The higher rates that fought inflation also didn't slow economic activity enough to catalyze a recession. So far, soft landing. This, combined with recent rate cuts (half a percent in September 2024 and a quarter percent in November 2024) have led to strong stock market performance in 2024. The icing on the cake for 2024 returns was Donald Trump’s victory in the U.S. Presidential Election in early November, sending major indices to all-time highs in the week following the election. Still, debates around the health of the economy and the impact of potential tariffs and corporate tax cuts remain, leaving much uncertainty around 2025.
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