6 Reasons Why Investors Should Bet on Kirby (KEX) Stock Now
Kirby CorporationKEX is benefiting from strength across its distribution and services segment. KEX’s strong cash flow generating ability is evident from its raised guidance for 2023.
Against this backdrop, let’s look at the factors that make this stock an attractive pick.
What Makes Kirby 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 Kirby gained 27.6% so far this year compared with the 6.8% rise of the industry it belongs to.
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Solid Rank & VGM Score: Kirby currently carries a Zacks Rank #2 (Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities. Thus, the company seems to be an appropriate investment proposition at the moment.
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 90 days, the Zacks Consensus Estimate for Kirby’s 2023 and 2024 earnings has moved up 4.5% and 4.1%, year over year, respectively.
Earnings Expectations: Earnings growth and stock price gains often indicate a company’s prospects. For third-quarter 2023, KEX’s earnings are expected to grow 58.46% year over year. For 2023 and 2024, KEX’s earnings are expected to grow 76.67% and 30.53%, year over year, respectively.
Positive Earnings Surprise History: Kirby has an impressive earnings surprise history. The company has surpassed the Zacks Consensus Estimate in each of the last four quarters (missing the mark once). The average beat is 8.03%.
Growth Factors: Kirby is benefiting from strength across its distribution and services segment. Favorable market conditions at its marine transportation unit are also encouraging. Meanwhile, KEX’s strong cash flow generating ability looks encouraging. During the first half of 2023, Kirby generated $227.9 million of cash from operating activities, higher than $95.6 million in the year-ago period. For 2023, KEX has raised its guidance for net cash generated from operating activities between $500 million and $580 million, higher than the prior view of $480-$580 million.
Other Stocks to Consider
Investors interested in the Zacks Transportation sector can also consider some other top-ranked stocks like United Airlines UAL and Delta Air Lines DAL. UAL presently sports a Zacks Rank #1, while DAL currently carries a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.
United Airlines is seeing a steady recovery in domestic and international air-travel demand. Owing to this, UAL expects revenues for the September quarter to grow 10-13% year over year. Our third-quarter total revenue estimate hints at an increase of 11.4% year over year.
For third-quarter 2023, United Airlines anticipates capacity to improve 16% from the year-ago reported figure. The Zacks Consensus Estimate for UAL’s current-year earnings has been revised 19.7% upward over the past 60 days.
Improved air-travel demand, particularly on the domestic front, is aiding Delta. Due to the positive, DAL reported better-than-expected earnings per share (EPS) and revenues in the second quarter of 2023. For third-quarter 2023, the company expects EPS in the range of $2.2-$2.5.
Management also raised its EPS outlook for the current year. The company now anticipates 2023 EPS (on an adjusted basis) in the band of $6-$7 (previous view: $6 per share). The Zacks Consensus Estimate for DAL’s current-year earnings has been revised 23.5% upward over the past 60 days.
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