Schneider National, Inc. SNDR performed well in the past three-month period and has the potential to sustain the momentum. If you haven’t taken advantage of its share price appreciation yet, it’s time you add the stock to your portfolio.
Let’s take a look at the factors that make the stock an attractive pick.
Price Outperformance: A glimpse at the company’s price trend reveals that its shares have increased 4.5% in the past three months against a 6.4% loss of the industry it belongs to.
Image Source: Zacks Investment Research
Solid Rank & VGM Score: Schneider National currently sports a Zacks Rank #1 (Strong Buy) and has a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, when combined with a Zacks Rank #1 or 2 (Buy), offer the best investment opportunities. Thus, the company seems to be an appropriate investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.
Northward Estimate Revisions: Seven estimates for 2021 moved north in the past 60 days versus no southward revision, reflecting analysts’ confidence in the company. The Zacks Consensus Estimate for 2021 earnings has moved up 16.6% in the past 60 days.
Positive Earnings Surprise History: Schneider National has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in all of the trailing four quarters, delivering an earnings surprise of 16%, on average.
Strong Growth Prospects: The Zacks Consensus Estimate for 2021 earnings is pegged at $1.96, which reflects year-over-year growth of 56.8%. The company’s long-term expected earnings per share (EPS) growth rate is at 17.9%.
Driving Factors: Schneider National has a strong cash position. Its cash and cash equivalents at the end of the second quarter stood at $490.5 million, higher than the current maturities of debt and finance lease obligations of $100.7 million. The company’s current ratio (a measure of liquidity) stood at 1.94. A current ratio, which is greater than 1.5, is usually considered good for a company.
Strong performances in the Intermodal and Logistics segments are driving the company’s top line, which increased 20.3% year over year in the first half of 2021. The Intermodal segment (revenues rose 15.9% in the first half of 2021) is benefiting from yield management and increased volumes, mainly in the Eastern rail network, while the Logistics unit (revenues surged 67.2% year over year) is thriving on favorable constructive market conditions and other factors.
Recently, the company deployed a battery-electric truck (BEV) as part of the carrier’s plan to reduce greenhouse emissions. Starting next year, the company will add 50 Freightliner eCascadias to its Southern California intermodal operations. This will make the organization one of the largest battery-electric truck fleets in North America. It also has plans for more BEVs and route options.
Other Stocks to Consider
Investors interested in the broader Zacks Transportation sector can also consider stocks like Saia, Inc. SAIA, Landstar System, Inc. LSTR and TFI International Inc. TFII. Saia and Landstar carry a Zacks Rank #2, while TFI International sports a Zacks #1 Rank.
Long-term expected earnings per share (three to five years) growth rate for Saia, Landstar and TFI International is pegged at 29.9%, 12% and 31.6%, respectively.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Landstar System, Inc. (LSTR) : Free Stock Analysis Report
Saia, Inc. (SAIA) : Free Stock Analysis Report
Schneider National, Inc. (SNDR) : Free Stock Analysis Report
TFI International Inc. (TFII) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research