What's in the Cards for Expeditors (EXPD) in Q2 Earnings?

Zacks Equity Research
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Expeditors International of Washington EXPD is scheduled to report second-quarter 2022 results on Aug 2, before market open.

The Zacks Consensus Estimate for EXPD’s second-quarter 2022 earnings has been revised upward by 23.7% in the past 90 days. The company also has an impressive earnings surprise history, having outperformed the Zacks Consensus Estimate in each of the preceding four quarters, the average beat being 21.38%.Our estimate of $2.04 earnings per share for the to-be-reported quarter, indicates a growth of 10.8% from the year-ago reported figure.

Let’s see how things are shaping up for Expeditors this earnings season.

Expeditors International of Washington, Inc. Price and EPS Surprise

Expeditors International of Washington, Inc. price-eps-surprise | Expeditors International of Washington, Inc. Quote

Q2 Expectations

The Zacks Consensus Estimate for Expeditors’ second-quarter 2022 revenues is pegged at $4.47 billion, indicating 23.8% growth year over year. Our estimate of $4.16 billion of revenues indicates a growth of 15.2% from the year-ago reported figure.

The Zacks Consensus Estimate for second-quarter Airfreight Services revenues is pegged at $1.77 billion, indicating a 10.5% rise from the prior-quarter reported number. Our estimate of $1.63 billion of Airfreight Services revenues indicates a growth of 6.9% from the year-ago reported figure. The increased usage of charters to meet customer needs amid coronavirus-induced cancellation of multiple passenger flights (that usually carry freight as well as passenger luggage) is likely to have driven Airfreight Services revenues, as has been the case over the past few quarters.

The Zacks Consensus Estimate for second-quarter Ocean Freight and Ocean Services revenues is pegged at $1.68 billion, indicating a 14.9% decline from the prior-quarter reported number. Our estimate of $1.51 billion of revenues for the same indicates a growth of 37.1% from the year-ago reported figure.

The Zacks Consensus Estimate for second-quarter Customs Brokerage and Other Services revenues is pegged at $1.02 billion, indicating a 6.2% decline from the prior-quarter reported number. Our estimate of $1.02 billion of revenues for the same indicates a growth of 3.6% from the year-ago reported figure.

However, labor and infrastructure constraints, and congestion at the ocean ports due to labor and equipment shortages, are likely to have hurt Expeditors’ second-quarter performance. Additionally, escalating operating expenses across all segments might have dented the company’s bottom line.

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. But that’s 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 -3.12% and a Zacks Rank #2.

Highlights of Q1

Expeditors’ first-quarter 2022 earnings of $2.05 per share surpassed the Zacks Consensus Estimate of $1.77. The bottom line surged 22.75% year over year. Total revenues of $4,664.3 million outperformed the Zacks Consensus Estimate of $4,175.6 million and increased 38.9% year over year. Higher revenues across all units boosted the top line.

Stocks to Consider

Investors interested in the broader Transportation sector can consider stocks like Werner Enterprises WERN and International Seaways INSW, as these stocks possess the right combination of elements to beat estimates this reporting cycle.

Werner has an Earnings ESP of +1.42% and a Zacks Rank #3 at present. WERN will release second-quarter 2022 results on Aug 3.

Werner’s efforts to reward its shareholders through dividends and share buybacks are impressive. Improvement in the freight scenario is aiding performances of the Logistics and Truckload Transportation Services segments.

International Seaways has an Earnings ESP of +27.57% and is currently a #2 Ranked player. INSW will release second-quarter 2022 results on Aug 9.

International Seaways provides energy transportation services for crude oil and petroleum products. This tanker company owns and operates a fleet including ULCC, eight VLCCs, eight Aframaxes/LR2s, 12 Panamaxes/LR1s and 20 MR tankers.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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