Q3 Earnings Preview for Ryder System (NYSE:R)

in EARNINGS/INVESTING IDEAS by

Ryder System, Inc. (NYSE:R) is scheduled to report Q3 earnings results on October 28, 2020.

The company is expected to report earnings of -$0.32/share on revenue of $2.008 billion. The consensus earnings per share (EPS) of -$0.32/share is based on a poll of 9 analysts and represents a growth in eps of 78.6% over the same quarter last year, when the company reported earnings of -$1.49/share.

The revenue forecast of $2.008 billion based on a poll of 8 analysts implies a year-over-year (YoY) decline in revenue of −9.7%. Last year the company reported $2.224 billion in revenue for the quarter.

Expected to report EPS of -$0.32/share for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $2,007.59 $2,223.90 −9.7%
EPS -$0.32 -$1.49 −78.6%

Earnings Call Trends

Historically, management has exceeded analyst expectations 4 out of the last 8 tracked quarters, and missed expectations 4 quarters.

What are your expectations from Ryder System, Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 -$1.31 -$0.95 27.6% Beat
Q1, 2020 -$0.85 -$1.38 -62.9% Missed
Q4, 2019 $0.03 -$0.01 −138.2% Missed
Q3, 2019 $1.49 -$1.49 −200.0% Missed
Q2, 2019 $1.40 $1.40 0.1% Beat
Q1, 2019 $0.99 $1.11 11.6% Beat
Q4, 2018 $1.81 $1.82 0.5% Beat
Q3, 2018 $1.65 $1.64 −0.5% Missed

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by falling −10.8%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 29, 2020 $42.17 $37.63 −10.8% Decline
April 29, 2020 $30.70 $35.40 15.3% Increase
February 13, 2020 $50.19 $40.12 −20.1% Decline
October 29, 2019 $55.12 $48.44 −12.1% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −3.50, the model suggests that the company is not likely to be an earnings manipulator. A value of −3.50 implies a 0.0% chance of earnings manipulation.

Fundamentals And Technical Analysis

Ryder System, Inc. is currently trading at $50.73/share, down −1.6% for the day. The company is trading at approximately 88.4% of its 52-week high of $57.38/share. The company’s stock price is up 34.8% since the last earnings report and up 0.8% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 66.84 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:R Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of −8.33 and a forward P/E multiple of −19.67.

Ryder System, Inc.’s current share price also implies a price-to-book (P/B) multiple of 1.26. The following table summarizes some other key fundamental ratios:

Data as of October 26, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $50.73
P/E Ratio −8.3x
P/E Ratio (Fwd) −19.7x
PEG Ratio 0.0
Total Debt / Total Capital 75.1%
Levered Free Cash Flow $437.3 million
EV / EBITDA 4.7x

Finbox

Ryder System, Inc. is a mid-cap stock with a market capitalization of $2.73 billion and a total enterprise value of $10.281 billion. The company operates in the Industrials sector and the Road & Rail industry.

Ryder System, Inc. provides transportation and supply chain management solutions worldwide. The company operates through three segments: Fleet Management Solutions (FMS), Supply Chain Solutions (SCS), and Dedicated Transportation Solutions (DTS). The FMS segment offers full service leasing and leasing with flexible maintenance options, as well as maintenance services, supplies, and related equipment for operation of the vehicles; commercial vehicle rental services; and contract or transactional maintenance services of trucks, tractors, and trailers, as well as fleet support services. This segment also provides access to diesel fuel; offers fuel planning and tax reporting, cards, and monitoring services, and centralized billing; and sells used vehicles through its 51 retail sales centers and Usedtrucks.Ryder.com website. The DTS segment offers equipment, maintenance, drivers, administrative, and additional services, as well as routing and scheduling, fleet sizing, safety, regulatory compliance, risk management, technology and communication systems support, and other technical support services. The SCS segment comprises distribution management services, such as designing and managing customer’s distribution network and facilities; providing e-commerce services; coordinating warehousing and transportation for in and outbound material flows; handling import and export for international shipments; coordinating just-in-time replenishment of component parts to manufacturing and final assembly; and offering shipments to customer distribution centers or end customer delivery points, as well as other value added services. This segment also offers transportation management services, such as shipment optimization, load scheduling, and delivery confirmation services through technological and web-based solutions; and knowledge-based professional services. Ryder System, Inc. was founded in 1933 and is headquartered in Miami, Florida.

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