Quarterly earnings results are a good time to check in on a company’s progress, especially compared to its peers in the same sector. Today we are looking at Hub Group (NASDAQ: HUBG) and the best and worst performers in the air freight and logistics industry.
The growth of e-commerce and global trade continues to drive demand for expedited shipping services, presenting opportunities for air freight companies. The industry continues to invest in advanced technologies such as automated sorting systems and real-time tracking solutions to enhance operational efficiency. Despite the advantages of speed and global reach, air freight and logistics companies are still at the whim of economic cycles. Consumer spending, for example, can greatly impact the demand for these companies’ offerings while fuel costs can influence profit margins.
The 6 air freight and logistics stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 2.8% while next quarter’s revenue guidance was 1% below.
In light of this news, share prices of the companies have held steady as they are up 2.8% on average since the latest earnings results.
Weakest Q2: Hub Group (NASDAQ: HUBG)
Started with $10,000, Hub Group (NASDAQ: HUBG) is a provider of intermodal, truck brokerage, and logistics services, facilitating transportation solutions for businesses worldwide.
Hub Group reported revenues of $905.6 million, down 8.2% year on year. This print fell short of analysts’ expectations by 1.6%. Overall, it was a slower quarter for the company with a significant miss of analysts’ EPS estimates and full-year revenue guidance missing analysts’ expectations.
“The team continues to navigate this operating environment with a focus on serving customers, improving productivity, and leveraging growth investments. Intermodal margin performance and new customer wins for the Final Mile business reflect success with our approach. Hub Group has made progress with cost-saving initiatives and remains opportunistic with capital deployment as reflected in the announced agreement to acquire certain assets from Marten Intermodal. Although market conditions remain challenging, higher margin and free cash flow performance from cycle trough-to-trough highlight the benefits of our strategy and execution, and we remain optimistic on the long-term growth opportunity,” said Phil Yeager, Hub Group’s President, Chief Executive Officer and Vice Chairman.
Hub Group delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The market was likely pricing in the results, and the stock is flat since reporting. It currently trades at $35.23.
Read our full report on Hub Group here, it’s free.
Best Q2: Expeditors (NYSE: EXPD)
Expeditors (NYSE: EXPD) offers air and ocean freight as well as brokerage services.
Expeditors reported revenues of $2.65 billion, up 8.7% year on year, outperforming analysts’ expectations by 9.2%. The business had a stunning quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.
Expeditors delivered the biggest analyst estimates beat among its peers. The market seems content with the results as the stock is up 1.3% since reporting. It currently trades at $118.41.
Is now the time to buy Expeditors? Access our full analysis of the earnings results here, it’s free.
United Parcel Service (NYSE: UPS)
Trademarking its recognizable UPS Brown color, UPS (NYSE: UPS) offers package delivery, supply chain management, and freight forwarding services.
United Parcel Service reported revenues of $21.22 billion, down 2.7% year on year, exceeding analysts’ expectations by 1.7%. It may have had the worst quarter among its peers, but its results were still good as it also locked in an impressive beat of analysts’ sales volume estimates and a decent beat of analysts’ EBITDA estimates.
As expected, the stock is down 15.1% since the results and currently trades at $86.25.
Read our full analysis of United Parcel Service’s results here.
GXO Logistics (NYSE: GXO)
With notable customers such as Nike and Apple, GXO (NYSE: GXO) manages outsourced supply chains and warehousing for various companies.
GXO Logistics reported revenues of $3.30 billion, up 15.9% year on year. This result beat analysts’ expectations by 6.4%. It was a very strong quarter as it also logged a solid beat of analysts’ adjusted operating income estimates and an impressive beat of analysts’ EBITDA estimates.
GXO Logistics achieved the fastest revenue growth among its peers. The stock is up 6.5% since reporting and currently trades at $52.22.
Read our full, actionable report on GXO Logistics here, it’s free.
FedEx (NYSE: FDX)
Sporting one of the largest air cargo fleets in the world, FedEx (NYSE: FDX) is a global provider of parcel and cargo delivery services.
FedEx reported revenues of $22.22 billion, flat year on year. This number topped analysts’ expectations by 1.9%. Overall, it was a strong quarter as it also produced a solid beat of analysts’ adjusted operating income estimates and a decent beat of analysts’ EBITDA estimates.
The stock is down 1.7% since reporting and currently trades at $225.30.
Read our full, actionable report on FedEx here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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