Knight Swift (KNX) Slashes Q4 EPS Projection, Stock Down
Shares of Knight-Swift Transportation Holdings KNX declined 4.95% to $34 in after-market trading on Dec 19, following the company’s earnings per share guidance cut for fourth-quarter 2019. Detailed results of the December-end quarter will be announced in January 2020.
In fact, shares of this North American truckload transportation company have had a bearish run on the bourse, lately. In the past six months, shares of this Phoenix, AZ,-based company have underperformed its industry. The Knight-Swift stock gained 12.2% compared with its industry’s 21.8% appreciation.
Knight Swift’s Commentary
Knight-Swift now expects fourth-quarter 2019 adjusted earnings per share between 50 and 52 cents (earlier expectation was in the 62-65 cents band). The Zacks Consensus Estimate for the metric is currently pegged at 63 cents.
This Zacks Rank #3 (Hold) company blamed the persistent oversupply of truckload capacity in its industry as the primary reason for a trimmed outlook. Due to the excess supply scenario, the seasonal improvement in the freight market from the third to the fourth quarter has been subdued in nature, resulting in lower-than-expected seasonal high-yield freight opportunities. Consequently, the sequential rate increases were lesser than anticipated which, in turn, have dented revenues and operating income for the December quarter.
The gloomy freight scenario is highlighted in the latest Cass Freight Shipments Index report, suggesting that North American freight shipments declined for 12 consecutive months, starting December 2018.
In October, Knight-Swift predicted first-quarter 2020 adjusted earnings per share in the 42-46 cents range. However, it now aims to revise the same, while releasing its fourth-quarter 2019 results next month. At the same time, the company intends to issue its earnings guidance for second-quarter 2020.
Stocks Worth a Look
Investors interested in the Zacks Transportation sector may consider Costamare CMRE, Allegiant Travel Company ALGT and Marten Transport MRTN. While Costamare and Allegiant sport a Zacks Rank #1 (Strong Buy), Marten Transport carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Costamare, Allegiant and Marten Transport have rallied more than 87%, 31% and 25%, respectively, over the past six months.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Allegiant Travel Company (ALGT) : Free Stock Analysis Report
Costamare Inc. (CMRE) : Free Stock Analysis Report
Marten Transport, Ltd. (MRTN) : Free Stock Analysis Report
Knight-Swift Transportation Holdings Inc. (KNX) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
