Q3 Earnings Highs And Lows: Hertz (NASDAQ:HTZ) Vs The Rest Of The Ground Transportation Stocks

December 30, 2024 at 04:07 AM EST

HTZ Cover Image

The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s take a look at how ground transportation stocks fared in Q3, starting with Hertz (NASDAQ: HTZ).

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 softer Q3. As a group, revenues missed analysts’ consensus estimates by 1.9%.

While some ground transportation stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1% since the latest earnings results.

Hertz (NASDAQ: HTZ)

Started with a dozen Model T Fords, Hertz (NASDAQ: HTZ) is a global car rental company providing vehicle rental services to leisure and business travelers.

Hertz reported revenues of $2.58 billion, down 4.7% year on year. This print fell short of analysts’ expectations by 3.8%. Overall, it was a softer quarter for the company with a significant miss of analysts’ adjusted operating income and EPS estimates.

"In the third quarter, we continued executing on our efforts to implement our transformation, focusing on our back-to-basics strategy to deliver sustainable, long-term returns for shareholders," said Gil West, Hertz CEO.

Interestingly, the stock is up 7.7% since reporting and currently trades at $3.62.

Read our full report on Hertz here, it’s free.

Best Q3: XPO (NYSE: XPO)

Owning a mobile game simulating freight operations for the Tour de France, XPO (NYSE: XPO) is a transportation company specializing in expedited shipping services.

XPO reported revenues of $2.05 billion, up 3.7% year on year, outperforming analysts’ expectations by 1.8%. The business had a very strong quarter with an impressive beat of analysts’ EBITDA estimates.

XPO achieved the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 10.7% since reporting. It currently trades at $133.16.

Is now the time to buy XPO? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: 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 $745.7 million, down 8.8% year on year, falling short of analysts’ expectations by 2.6%. It was a disappointing quarter as it posted a significant miss of analysts’ adjusted operating income estimates.

As expected, the stock is down 5.3% since the results and currently trades at $36.25.

Read our full analysis of Werner’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 $1.06 billion, down 5.8% year on year. This result was in line with analysts’ expectations. More broadly, it was a softer quarter as it logged a significant miss of analysts’ EPS estimates.

The stock is down 12.6% since reporting and currently trades at $91.21.

Read our full, actionable report on ArcBest here, it’s free.

Old Dominion Freight Line (NASDAQ: ODFL)

With its name deriving from the Commonwealth of Virginia’s nickname, Old Dominion (NASDAQ: ODFL) delivers less-than-truckload (LTL) and full-container load freight.

Old Dominion Freight Line reported revenues of $1.47 billion, down 3% year on year. This print missed analysts’ expectations by 1.2%. It was a slower quarter as it also recorded a miss of analysts’ EBITDA estimates.

The stock is down 9.3% since reporting and currently trades at $181.

Read our full, actionable report on Old Dominion Freight Line here, it’s free.

Market Update

Thanks to the Fed's series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market has thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump's presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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