Ryder System Reports Mixed Q3: Contractual Growth Meets Freight Market Challenges

Benzinga10-24

Ryder System Inc (NYSE:R) shares are trading lower on Thursday after it reported third-quarter results.

Sales grew 8% year-on-year to $3.17 billion, missing the analyst consensus estimate of $3.29 billion.

Revenue from Fleet Management Solutions fell 1% to $1.47 billion, Supply Chain Solutions climbed 10% to $1.317 billion and Dedicated Transportation Solutions jumped 41% to $633 million.

Earnings before tax declined to $188 million from $213 million a year ago quarter. Adjusted EPS of $3.44 beat the analyst consensus of $3.42.

Operating cash flow for nine months totaled $1.7 billion, with a free cash flow of $218 million. Ryder System held $162 million in cash and equivalents as of September-end.

The company’s board recently authorized a new discretionary 2 million share repurchase program that replaces the recently completed program.

Ryder Chairman & CEO Robert Sanchez said, “We saw double-digit earnings growth in our contractual businesses. Higher ChoiceLease results from our pricing and maintenance initiatives benefited FMS. Stronger operating performance and cost-management actions benefited SCS. DTS delivered strong earnings growth, demonstrating the resiliency of our legacy business. Each of the segments also benefited from recent acquisitions.”

“The long-term secular growth trends remain intact for all of our contractual businesses, although we are experiencing near-term sales headwinds that reflect the extended freight downturn and overall economic uncertainty.”

Outlook: Ryder lowered its FY24 operating revenue growth to ~7% (vs. ~8% prior) and tightened the adjusted EPS forecast to $11.90 – $12.10 (vs. consensus of $12.13) from $11.90 – $12.40 earlier.

For the fourth quarter, Ryder sees adjusted EPS of $3.32 – $3.52 against the consensus of $3.57.

Investors can gain exposure to the stock via First Trust Nasdaq Transportation ETF (NASDAQ:FTXR) and SPDR S&P Transportation ETF (NYSE:XTN).

Price Action: R shares are down 4.36% at $138.71 at the last check Thursday.

Read Next:

  • Uber, Lyft Shares Are Sliding In Premarket Today: Is Elon Musk’s Robotaxi Plan The Reason?
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment