Landstar (LSTR) Down 6.2% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Landstar System (LSTR). Shares have lost about 6.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Landstar due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Landstar Q2 Earnings Beat
Landstar System reported solid second-quarter 2023 results wherein earnings and revenues beat the Zacks Consensus Estimate.
Quarterly earnings per share (EPS) of $1.85 beat the Zacks Consensus Estimate of $1.80 but fell 39.3% year over year. Revenues of $1,373.9 million beat the Zacks Consensus Estimate of $1,338.7 million but declined 30.4% year over year.
Operating income fell 41.5% from the prior-year quarter’s figure to $87.95 million. Total costs and expenses (on a reported basis) decreased 29.4% to $1,288.39million.
Total revenues in the truck transportation segment, contributing to 90.8% of the top line, amounted to $1.25 billion, down 28.6% from the year-ago quarter’s figure. Rail intermodal revenues of $25.23 million decreased 41.9% from the figure recorded in second-quarter 2022.
Revenues in the ocean and air-cargo carrier segments declined 52.5% year over year to $75.44 million. Other revenues increased 2.5% to $26.24 million.
Liquidity, Dividends & Buyback
At the end of second-quarter 2023, Landstar had cash and cash equivalents of $360.52 million compared with $340.98 million recorded at the prior-quarter end. Additionally, long-term debt (excluding current maturities) totaled $53.14 million at the end of the second quarter compared with $60.19 million at the first-quarter end.
LSTR is currently authorized to purchase up to 2,910,339 shares under its previously announced share purchase programs. LSTR’s board of directors has announced a quarterly dividend of 33 cents per share, indicating a hike of 10% from its previous dividend payout of 30 cents. The raised dividend will be paid on Aug 25, 2023, to stockholders of record as of the close of business on Aug 10.
Q3 Outlook
Landstar anticipates third-quarter 2023 revenues in the range of $1.275 billion-$1.325 billion. EPS for the third quarter is estimated to be in the band of $1.65-$1.75.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -13.43% due to these changes.
VGM Scores
At this time, Landstar has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Landstar has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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Landstar System, Inc. (LSTR) : Free Stock Analysis Report
