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Ryder (R) Q1 Earnings & Revenues Beat, 2021 Earnings View Up

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Ryder System, Inc. R delivered first-quarter 2021 earnings (excluding 13 cents from non-recurring items) of $1.09 per share, surpassing the Zacks Consensus Estimate of 58 cents. In the year-ago period, the company incurred a loss of $1.38.

Total revenues of $2,221.6 million beat the Zacks Consensus Estimate of $2,148.1 million. The top line inched up approximately 3% year over year due to higher supply chain and rental revenues.

Segmental Results

Fleet Management Solutions (“FMS”): Total revenues in the segment amounted to $1,335 million, flat year over year. Operating revenues (excluding fuel and lease liability insurance revenues) summed $1,168 million, up 1% year over year. Segmental results benefited from higher rental pricing amid lower SelectCare and other revenues. While commercial rental revenues increased 8% from the year-ago period, fuel services revenues fell 4%. ChoiceLease revenues inched up 1% year over year.

Dedicated Transportation Solutions (“DTS”): Total revenues amounted to $320.5 million, down 4% from the year-ago quarter’s figure. The decline in DTS’ total revenues was primarily caused by lower subcontracted transportation. Operating revenues (excluding fuel and subcontracted transportation) were flat year over year at $237 million.

Supply Chain Solutions (“SCS”): Total revenues in the segment were $707 million, up 12% year over year. Operating revenues (excluding fuel and subcontracted transportation) rose 8% year over year to $503 million. Segmental results were driven by new business and higher volumes.

Ryder System, Inc. Price, Consensus and EPS Surprise

Ryder System, Inc. Price, Consensus and EPS Surprise
Ryder System, Inc. Price, Consensus and EPS Surprise

Ryder System, Inc. price-consensus-eps-surprise-chart | Ryder System, Inc. Quote

Other Details

Ryder, carrying a Zacks Rank #3 (Hold), exited the first quarter with cash and cash equivalents of $91.7 million compared with $151.3 million at the end of 2020. The company’s total debt (including current portion) fell to $6,372.2 million at the end of the first quarter from $6,610.2 million at the end of 2020.

Gross capital expenditures increased to $407 million in the first quarter of 2021 compared with $392 million in the year-ago period due to higher investments on rental fleet. Free cash flow in the period was $241 million, higher than $111 million in the year-ago period. The increase was due to lower cash capital expenditures.

2021 Earnings View Increased

Ryder now anticipates adjusted earnings per share to be $5.50-$5.90 in 2021, better than the previously guided range of $4.15-$4.65. The Zacks Consensus Estimate for the same stands at $4.49. Free cash flow is estimated to be between $400 million and $700 million in the year. Capital expenditures are predicted to be in the range of $2 billion-2.3 billion.

For the second quarter of 2021, the company estimates adjusted earnings of $1.25-$1.35 per share. The Zacks Consensus Estimate for the same is pegged at $1.04.

Thanks to the improving freight environment, the company anticipates the FMS segment to perform well, driven by lease, rental and used vehicle sales. It expects strong pricing in rental and used vehicle sales to continue.

However, Ryder expects its supply chain earnings to be negatively impacted by semiconductor shortage.

Sectorial Snapshot

Let’s take a look at some of the other recently released earnings reports from companies within the Zacks Transportation sector.

Canadian National Railway Company CNI, carrying a Zacks Rank #3, reported first-quarter 2021 earnings (excluding 11 cents from non-recurring items) of 97 cents per share (C$1.23), missing the Zacks Consensus Estimate of 99 cents. Quarterly revenues of $2,791.6 million (C$3,535 million) lagged the Zacks Consensus Estimate of $2,813.1 million.

Landstar System LSTR, sporting a Zacks Rank #1 (Strong Buy), reported first-quarter 2021 earnings of $2.01 per share, surpassing the Zacks Consensus estimate of $1.61. Additionally, revenues of $1,287.5 million outperformed the Zacks Consensus Estimate of $1,142.5 million. You can see the complete list of today's Zacks #1 Rank stocks here.

Southwest Airlines LUV, carrying a Zacks Rank of 3, incurred a loss of $1.72 per share (excluding $1.91 from non-recurring items) in the first quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of $1.82. Meanwhile, operating revenues of $2,052 million surpassed the Zacks Consensus Estimate of $2,031.7 million.

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