Ryder (R) Touches 52-Week High: What's Driving the Stock?
Shares of Ryder System, Inc. R scaled a 52-week high of $108.20 in the trading session on Nov 29, 2023, before closing a tad lower at $107.13.
The company’s shares gained 28.2% so far this year compared with the 9.7% rise of the industry it belongs to.
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Let’s find out the factors supporting the uptick.
Ryder’s encouraging 2023 earnings outlook raises optimism about the stock. While releasing its third-quarter 2023 result, management lifted its earnings per share (EPS) outlook for 2023, driven by the successful execution of Ryder's strategic, operational and financial plan. Adjusted EPS for the year is now estimated to be between $12.60 and $12.85 (prior view: $12.20 and $12.70). Adjusted ROE (return on equity) is now expected in the 18-19% band (prior view: 17-19%). R continues to expect operating revenues to increase 2% for 2023.
Ryder’s measures to reward its shareholders through dividends and share buybacks are also appreciated. In July 2023, Ryder announced a 14.5% hike in its quarterly dividend, taking the total to 71 cents per share (annualized $2.84).
The company is also active on the buyback front. In October 2023, Ryder’s board approved two new share repurchase programs. Per the first program, management is authorized to repurchase up to 2 million shares issued to employees under its employee stock plans since Aug 31, 2023, under a new anti-dilutive program (the "2023 Anti-Dilutive Program"). The second program allows management discretion to buyback up to 2 million shares of common stock over two years under a new discretionary share repurchase program (the "October 2023 Discretionary Program"). Both the 2023 Anti-Dilutive Program and the October 2023 Discretionary Program are effective from Oct 12, 2023, through Oct 12, 2025.The company’s previously authorized February 2023 discretionary repurchase program was completed in September 2023, and the 2021 anti-dilutive repurchase program expired in October 2023.
During the first nine months of 2023, R repurchased shares worth $282 million and paid $96 million in the form of dividends.
The positive sentiment surrounding the stock is evident from the fact that the Zacks Consensus Estimate for current-year earnings has been revised upward by 0.4% over the past 60 days. Further, R has an encouraging track record with respect to earnings surprise, having surpassed the Zacks Consensus Estimate in three of the past four quarters. The average beat is 7.62%.
Zacks Rank and Stocks to Consider
Currently, Ryder carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Zacks Transportation sector are Westinghouse Air Brake Technologies Corporation, operating as Wabtec Corporation WAB, ZTO Express (ZTO) and SkyWest, Inc. SKYW. Each stock presently carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Wabtec has an expected earnings growth rate of 22.02% for the current year. WAB delivered a trailing four-quarter earnings surprise of 7.11%, on average.
The Zacks Consensus Estimate for WAB’s current-year earnings has improved 5.1% over the past 90 days. Shares of WAB have gained 17.3% year to date.
ZTO Express has an expected earnings growth rate of 26.02% for the current year. ZTO delivered a trailing four-quarter earnings surprise of 17.31%, on average.
The Zacks Consensus Estimate for ZTO’s current-year earnings has improved 4% over the past 90 days. Shares of ZTO have declined 17% year to date.
SkyWest's fleet-modernization efforts are commendable. The Zacks Consensus Estimate for SKYW’s current-year earnings has improved 31.5% over the past 90 days. Shares of SKYW have surged 181.3% year to date.
SKYW delivered a trailing four-quarter earnings surprise of 32.57%, on average.
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Ryder System, Inc. (R) : Free Stock Analysis Report
SkyWest, Inc. (SKYW) : Free Stock Analysis Report
Westinghouse Air Brake Technologies Corporation (WAB) : Free Stock Analysis Report
ZTO Express (Cayman) Inc. (ZTO) : Free Stock Analysis Report
