5 Reasons Why Investors Should Buy Old Dominion (ODFL) Stock
Old Dominion Freight Line, Inc. (ODFL) is benefiting from its shareholder-friendly initiatives. We believe such shareholder-friendly initiatives should boost investor confidence and positively impact the bottom line.
Against this backdrop, let’s look at the factors that make this stock an attractive pick.
What Makes ODFL an Attractive Pick?
An Outperformer: A glimpse at the company’s price trend reveals that the stock has had an impressive run on the bourse year to date. Shares of ODFL have gained 40.9% so far this year, outperforming the 25.9% rise of the industry it belongs to.
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Solid Zacks Rank: ODFL has a Zacks Rank #2 (Buy). Our research shows that stocks with a Zacks Rank #1 (Strong Buy) or 2 offer the best investment opportunities. Thus, the company is a compelling investment proposition at the moment.
Positive Earnings Surprise History: ODFL has an impressive earnings surprise history. The company delivered an earnings surprise of 3.86% in the last four quarters, on average.
Northward Estimate Revisions: The direction of estimate revisions serves as an important pointer when it comes to the price of a stock. Over the past 60 days, the Zacks Consensus Estimate for ODFL’s third-quarter 2023 earnings has moved up 1.8% year over year. Over the past 60 days, the Zacks Consensus Estimate for ODFL’s 2023 and 2024 earnings has increased 1.3% and 2.1%, year over year, respectively.
Growth Factors: Old Dominion's efforts to enhance shareholder value are impressive. ODFL’s board has raised its quarterly cash dividend by 33.3% to 40 cents per share, effective from the first quarter of 2023. During the first half of 2023, ODFL paid out dividends worth $44.1 million and repurchased shares worth $141.7 million.
While announcing its second-quarter 2023 results, ODFL's board approved a new share repurchase program that authorizes the company to buy back up to $3 billion of its outstanding stock. This new repurchase program will begin after the completion of the existing $2 billion repurchase program, under which $376.9 million remains available and uncommitted as of Jun 30, 2023.
Other Stocks to Consider
Some other top-ranked stocks from the Zacks Transportation sector are GATX Corporation (GATX), Westinghouse Air Brake Technologies Corporation, operating as Wabtec Corporation (WAB) and SkyWest, Inc. (SKYW). Each of these companies presently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
GATX has an expected earnings growth rate of 14.33% for the current year. GATX delivered a trailing four-quarter earnings surprise of 17.30%, on average.
The Zacks Consensus Estimate for GATX’s current-year earnings has improved 2.1% over the past 90 days. Shares of GATX have gained 6% year to date.
Wabtec has an expected earnings growth rate of 16.87% for the current year. WAB delivered a trailing four-quarter earnings surprise of 3.42%, on average.
The Zacks Consensus Estimate for WAB’s current-year earnings has improved 4.9% over the past 90 days. Shares of WAB have gained 5.9% year to date.
SkyWest's fleet-modernization efforts are commendable.A fall in operating expenses is a tailwind for SkyWest. In second-quarter 2023, the metric dipped 2.4% to $693.8 million due to a decline in operating costs. Low operating expenses boost bottom-line results. Shares of SKYW have surged 163.6% year to date.
SKYW delivered a trailing four-quarter earnings surprise of 31.51%, on average.
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Old Dominion Freight Line, Inc. (ODFL) : Free Stock Analysis Report
SkyWest, Inc. (SKYW) : Free Stock Analysis Report
Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report
GATX Corporation (GATX) : Free Stock Analysis Report
