Schneider's (SNDR) Q3 Earnings Meet Estimates, Decline Y/Y

Zacks Equity Research
·4 min read

Schneider National Inc.’s SNDR third-quarter 2020 earnings (excluding 6 cents from non-recurring items) of 31 cents per share were in line with the Zacks Consensus Estimate. The bottom line dipped 3.1% year over year due to lower revenues.

Operating revenues of $1,135.7 million surpassed the Zacks Consensus Estimate of $1,122.1 million. However, the top line declined 4.1% year over year. Moreover, revenues (excluding fuel surcharge) decreased 1% to $1,062.7 million. Results were hampered by decline in truckload revenues.

Income from operations (adjusted) declined 3% from the prior-year quarter’s level to $76.9 million. Also, adjusted operating ratio (operating expenses as a percentage of revenues) deteriorated 20 basis points to 92.8%. Notably, lower the value of the ratio, the better.

Schneider National, Inc. Price, Consensus and EPS Surprise

Schneider National, Inc. Price, Consensus and EPS Surprise
Schneider National, Inc. Price, Consensus and EPS Surprise

Schneider National, Inc. price-consensus-eps-surprise-chart | Schneider National, Inc. Quote

Segmental Highlights

Truckload revenues (excluding fuel surcharge) slipped 11% to $460.2 million due to low capacity and shutdown of FTFM (First to Final Mile) operations. Average trucks (company trucks and owner-operated trucks) in the segment also fell 7.9% to 10,052. Further, revenue per truck per week in the segment dropped 3.2%. Truckload income from operations was $45.6 million in the reported quarter against loss of $12.5 million in the year-ago period. Moreover, operating ratio improved to 90.1% from 102.4% in the year-ago quarter.

Intermodal revenues (excluding fuel surcharge) were $248.4 million, flat on a year-over-year basis. Revenue per order declined 4% due to shorter length of haul as a result of higher Eastern volumes. Segmental income from operations declined 8.4% to $23 million mainly due to persistent network disruption. Additionally, intermodal operating ratio deteriorated to 90.7% in the third quarter from the prior-year quarter’s 89.9%.

Logistics revenues (excluding fuel surcharge) surged 20% to $284.4 million, primarily due to expanded brokerage volumes and increase in revenue per order. Logistics income from operations fell 8.1% on a year-on-year basis. Further, operating ratio in the segment deteriorated to 96.8% from 95.8% in the third quarter of 2019.

Special Dividend

Schneider’s board approved a special dividend of $2 per share for holders of Class A and Class B shares. The dividend is payable to its shareholders on Nov 19, 2020, of record as of Nov 9.

Liquidity

Schneider, carrying a Zacks Rank #2 (Buy), exited the third quarter with cash and cash equivalents of $768.5 million compared with $551.6 million at the end of 2019. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

2020 Outlook

Schneider estimates adjusted earnings in the range of $1.18-$1.22 for 2020. The mid-point of the guided range — $1.20 — lies below the Zacks Consensus Estimate of $1.21. Additionally, for the full year, net capital expenditures are forecast at approximately $250 million.

Sectorial Snapshot

Let’s take a look at some other Zacks Transportation sector companies’ third-quarter earnings.

Southwest Airlines Co. LUV, carrying a Zacks Rank #3 (Hold), incurred a loss of $1.99 per share (excluding 3 cents from non-recurring items) in the third quarter of 2020, narrower than the Zacks Consensus Estimate of a loss of $2.44. Moreover, operating revenues of $1,793 million surpassed the Zacks Consensus Estimate of $1,678.2 million.
 
Trinity Industries Inc TRN, carrying a Zacks Rank #2, reported third-quarter 2020 earnings (excluding 4 cents from non-recurring items) of 17 cents per share, massively surpassing the Zacks Consensus Estimate of 5 cents. Total revenues of $459.4 million also outperformed the Zacks Consensus Estimate of $443.8 million.

CSX Corporation CSX, carrying a Zacks Rank of 3, reported third-quarter 2020 earnings of 96 cents per share, surpassing the Zacks Consensus Estimate of 93 cents. However, total revenues of $2,648 million lagged the Zacks Consensus Estimate of $2,704.6 million.

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