What's in the Cards for Expeditors (EXPD) in Q2 Earnings?
Expeditors International of Washington EXPD is scheduled to report second-quarter 2023 results on Aug 8, before market open.
The Zacks Consensus Estimate for EXPD’s second-quarter 2023 earnings has remained flat at $1.34 per share in the past 60 days. However, the company has an impressive earnings surprise history, having surpassed the consensus estimate in three of the preceding four quarters (missed once), the average beat being 3.39%.
Expeditors International of Washington, Inc. Price and EPS Surprise
Expeditors International of Washington, Inc. price-eps-surprise | Expeditors International of Washington, Inc. Quote
Given this backdrop, lets unearth the reasons likely to have influenced Expeditors’ second-quarter 2023 earnings.
We expect supply-chain woes to have hurt Expeditors’ performance in the quarter under review. Our estimate for revenues in the Airfreight Services, and Ocean Freight and Ocean Services segments is pegged at $908.2 million and $890.8 million, indicating declines of 43.3% and 49.4%, respectively, from second-quarter 2022 reported numbers.
Moreover, airfreight tonnage volume and ocean container volume might have negatively impacted EXPD’s performance in the quarter to be reported. Our model anticipates airfreight tonnage volume and ocean container volume to decrease 9.7% and 15%, respectively, from second-quarter 2022 levels.
However, our projection for Customs Brokerage and Other Services’ revenues is pegged at $1.26 billion, suggesting a 1.7% rise from the prior-year quarter’s reported number.
Higher capital expenses might have also dented the bottom line. The Zacks Consensus Estimate for second-quarter 2023 earnings indicates a decline of 40.97% year over year despite EXPD’s cost-cutting initiatives.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Expeditors this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Expeditors has an Earnings ESP of -1.36% and a Zacks Rank #3.
Highlights of Q1
Expeditors' first-quarter 2023 earnings of $1.45 per share surpassed the Zacks Consensus Estimate of $1.36. However, the bottom line decreased 29.3% year over year. Total revenues of $2,592.6 million lagged the Zacks Consensus Estimate of $3,149.5 million and plunged 44.4% year over year. Results were hurt by the lackluster demand scenario.
Stocks to Consider
Here we present some stocks from the broader Zacks Transportation sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings this season.
Allegiant Travel Company ALGT has an Earnings ESP of +2.76% and a Zacks Rank #2. ALGT will release second-quarter 2023 results on Aug 2. Upbeat passenger volumes are likely to have aided ALGT’s performance. You can see the complete list of today’s Zacks #1 Rank stocks here.
ALGT has an expected earnings growth rate of 215.3% for the current year. The company surpassed the Zacks Consensus Estimate in two of the past four quarters, missing once and reporting in-line earnings in the other occasion. The average beat is 79.78%.
Copa Holdings CPA currently has an Earnings ESP of +0.82% and carries a Zacks Rank #3. CPA will post second-quarter 2023 numbers on Aug 9.
We expect CPA’s second-quarter performance to have been aided by upbeat air-travel demand. It has an impressive earnings surprise history, having surpassed the Zacks Consensus Estimate in each of the preceding four quarters by an average of 14.6%.
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Expeditors International of Washington, Inc. (EXPD) : Free Stock Analysis Report
Copa Holdings, S.A. (CPA) : Free Stock Analysis Report
Allegiant Travel Company (ALGT) : Free Stock Analysis Report
