Knight-Swift Transportation Holdings Inc.’s KNX third-quarter 2020 earnings (excluding 8 cents from non-recurring items) of 79 cents per share surpassed the Zacks Consensus Estimate of 63 cents. Moreover, the bottom line surged 64.6% year over year owing to significant improvement in adjusted operating ratio (operating expenses as a percentage of revenues) in the Trucking segment.
Total revenues of $1,210.4 million beat the Zacks Consensus Estimate of $1,160.9 million and increased marginally year over year driven by increase in revenues in the Trucking and Logistics segment.
Total operating expenses declined 4.8% year over year to $1,044.9 million. Adjusted operating ratio improved to 83.9% from 89.6% in the year-ago quarter. Lower the value of the metric, the better. Knight-Swift’s adjusted operating income increased 61% year over year to $183.1 million.
Knight-Swift, sporting a Zacks Rank #1 (Strong Buy), exited the third quarter with cash and cash equivalents of $240.2 million compared with $159.72 million at the end of 2019. During the first nine months of 2020, the company returned $41.3 million to its shareholders in the form of dividends and $34.6 million through share buybacks. You can see the complete list of today’s Zacks #1 Rank stocks here.
KnightSwift Transportation Holdings Inc. Price, Consensus and EPS Surprise
KnightSwift Transportation Holdings Inc. price-consensus-eps-surprise-chart | KnightSwift Transportation Holdings Inc. Quote
Revenues in the Trucking segment totaled (excluding fuel surcharge and inter-segment transactions) $902.6 million, up 3% year over year.
Results were driven by 5.4% increase in average revenue per tractor. Average revenue per tractor was strong in the quarter due to a 5.1% rise in revenue per loaded mile (excluding fuel surcharge and intersegment transactions). Adjusted segmental operating income also moved up 54.1% to $169.1 million. Adjusted operating ratio (operating expenses as a percentage of revenues) improved 620 basis points (bps) to 81.3%.
Revenues in the Logistics segment (before inter-segment transactions) amounted to $96.2 million, up 15.1% year over year due to 18.2% increase in brokerage revenues. While adjusted operating ratio deteriorated 180 bps to 97.4%, segmental operating income slumped 32.9% to $2.5 million.
Revenues in the Intermodal segment (excluding inter-segment transactions) totaled $98.8 million, down 9.1% year over year as a result of declining load count and revenue per load by 5.7% and 3.7%, respectively. Segmental adjusted operating ratio surged 270 bps to 99.7%. Segmental operating income was $0.25 million, against operating loss of $2.65 million in the year-ago period.
The company expects adjusted earnings per share in the band of $2.68-$2.72 (previously $2.15-$2.30) for the full year 2020. The Zacks Consensus Estimate for the same stands at $2.32. Moreover, the company expects adjusted earnings per share in the band of $3.20-$3.40 for full year 2021. The Zacks Consensus estimate for the same stands at $2.78.
Net capital expenditures are anticipated between $380 million and $405 million. Previously, the same was expected in the range of $500-$525 million.
Apart from Knight-Swift, let’s take a look into some other Zacks Transportation sector’s third-quarter earnings like Delta Air Lines DAL , J.B. Hunt Transport Services JBHT and United Airlines Holdings, Inc. UAL .
Delta incurred a loss (excluding $5.17 from non-recurring items) of $3.30 per share in the September quarter, wider than the Zacks Consensus Estimate of a loss of $3.14. Meanwhile, Delta reported earnings of $2.32 per share (on an adjusted basis) in the year-ago quarter, driven by high passenger revenues as air-travel demand was buoyant at that time.
J.B. Hunt reported mixed third-quarter 2020 results, with earnings missing estimates and revenues beating the same. Quarterly earnings of $1.18 per share fell short of the Zacks Consensus Estimate of $1.26. Moreover, the bottom line declined 15.7% year over year due to disappointing performance of its intermodal (JBI) unit. Total operating revenues increased 4.6% to $2,472.5 million. Revenues also beat the consensus mark of $2,345.2 million.
United Airlines incurred a loss (excluding $1.83 from non-recurring items) of $8.16 per share, wider than the Zacks Consensus Estimate of a loss of $7.63. Results were hurt by the coronavirus-induced weakness in air-travel demand. Moreover, operating revenues of $2,489 million slumped 78.1% year over year and also lagged the Zacks Consensus Estimate of $2,570.1 million. This year-over-year plunge was due to 84.3% drop in passenger revenues to $1,649 million.
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