Have you been paying attention to shares of USA Truck (USAK)? Shares have been on the move with the stock up 34.8% over the past month. The stock hit a new 52-week high of $15.79 in the previous session. USA Truck has gained 55.7% since the start of the year compared to the 5.8% move for the Zacks Transportation sector and the 12.7% return for the Zacks Transportation - Truck industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 4, 2021, USA Truck reported EPS of $0.7 versus consensus estimate of $0.36.
For the current fiscal year, USA Truck is expected to post earnings of $1.4 per share on $606.5 million in revenues. This represents a 105.88% change in EPS on a 10.05% change in revenues. For the next fiscal year, the company is expected to earn $1.63 per share on $635.8 million in revenues. This represents a year-over-year change of 15.84% and 4.83%, respectively.
USA Truck may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
USA Truck has a Value Score of A. The stock's Growth and Momentum Scores are A and F, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 9.9X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 2.9X versus its peer group's average of 7.9X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, USA Truck currently has a Zacks Rank of #1 (Strong Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if USA Truck passes the test. Thus, it seems as though USA Truck shares could have potential in the weeks and months to come.
How Does USA Truck Stack Up to the Competition?
Shares of USA Truck have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also solid potential picks, including ArcBest (ARCB), P.A.M. Transportation Services (PTSI), and Saia (SAIA), all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 13% of all the industries we have in our universe, so it looks like there are some nice tailwinds for USA Truck, even beyond its own solid fundamental situation.
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USA Truck, Inc. (USAK) : Free Stock Analysis Report
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