C.H. Robinson Worldwide’s CHRW shares declined 2.7% in after-hours trading on Apr 28 following its first-quarter 2020 earnings release. The company’s earnings of 57 cents per share missed the Zacks Consensus Estimate of 71 cents. The bottom line also plunged 50.9% year over year.
However, total revenues of $3,805 million surpassed the Zacks Consensus Estimate of $3554.7 million and also increased 1.4% year over year. This upside was led by higher truckload and less than truckload (LTL) volumes.
Total operating expenses inched up 0.9% year over year to $458.51 million, primarily due to a 12.4% increase in selling, general and administrative expenses. Consequently, operating ratio (operating expenses as a percentage of net revenues) deteriorated to 80.7% from 66.9% in the year-ago quarter. With respect to this metric, the lower the value, the better.
The company returned $152.2 million to shareholders through a combination of cash dividends ($69.9 million) and share repurchases ($82.4 million). Capital expenditures totaled $14.7 million in the quarter under review. Full-year capital expenses are expected in the range of $60-$70 million, with the maximum reserved for technology spends.
C.H. Robinson Worldwide, Inc. Price, Consensus and EPS Surprise
C.H. Robinson Worldwide, Inc. price-consensus-eps-surprise-chart | C.H. Robinson Worldwide, Inc. Quote
At North American Surface Transportation (NAST), total revenues were $2,823.75 million (up 1%) in the first quarter. However, net revenues at the segment dropped 23.4% despite the Prime Distribution Services acquisition contributing 1 percentage point to segmental results. NAST results include Robinson Fresh transportation, which was previously reported under a separate segment.
Total revenues at Global Forwarding summed $530.38 million, down 1.3% year over year. Contraction in volumes at the ocean and air units affected results. Meanwhile, net revenues at the segment climbed 0.8% with The Space Cargo Group acquisition boosting results by 2 percentage points.
A historical presentation of the results on an enterprise basis is given below:
Transportation: The unit (comprising Truckload, Intermodal, LTL, Ocean, Air, Customs and Other logistics services) delivered net revenues of $542 million in the quarter under consideration, down 16.8% from the prior-year figure.
Truckload net revenues declined 29.9% year over year to $264.93 million despite volumes increasing 7.5% year over year. LTL net revenues also dropped 2% year over year to $113.91 million. However, LTL volumes grew 7.5% in the quarter.
At the Intermodal segment, net revenues increased 24.3% year over year to $7.55 millionas volumes rose 8%.Net revenues at the Ocean transportation segment declined 2.3% year over year to $69.9 million. The same at the air transportation segment increased 2.7% to $28.34 million. Meanwhile, customs net revenues slid 3.1% to $21.19 million.
However, Other logistics services’ net revenues rose 19.1% to $36.18 million.
Sourcing: Net revenues at the segment slipped 4.3% to $25.95 million.
This Zacks Rank #4 (Sell) company exited the first quarter with cash and cash equivalents of $294.57 million compared with $447.86 million at the end of 2019. Liquidity at the end of the quarter was more than $1.2 billion. Long-term debt was $1,092.66 million compared with $1,092.45 million at 2019-end.
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Performance of Other Transportation Stocks
Within the broader Transportation sector, Delta Air Lines DAL, CSX Corp. CSX and Union Pacific Corp. UNP reported earnings numbers last week.
Delta incurred a loss of 51 cents (excluding 33 cents from non-recurring items) in the March quarter, narrower than the Zacks Consensus Estimate of a loss of 72 cents. In the year-ago quarter, the company reported earnings (on an adjusted basis) of 96 cents per share. Total revenues of $8,592 million lagged the Zacks Consensus Estimate of $9,637.5 million and also declined 18% year over year.
CSX reported first-quarter 2020 earnings of $1 per share, beating the Zacks Consensus Estimate of 92 cents. However, the bottom line slipped approximately 2% year over year on a 5% drop in revenues. Total revenues of $2,855 million lagged the consensus estimate of $2,877 million owing to lower coal and other revenues.
Union Pacific’s first-quarter 2020 earnings of $2.15 per share surpassed the Zacks Consensus Estimate of $1.86. Operating revenues of $5,229 million also beat the consensus mark of $5,105.9 million. While the bottom line improved 11.4% on a year-over-year basis, primarily due to low costs, the top line declined 3% owing to sluggish freight revenues (down 3%).
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